Preamble

The House met at Eleven o'Clock

PRAYERS

[Mr. SPEAKER in the Chair]

Oral Answers to Questions — NATIONAL WAR EFFORT

Directed Mine-Workers

Mr. Thorne: asked the Minister of Labour the number of boys who have been sent to prison for refusing to go down the coalmines.

The Minister of Labour (Mr. Ernest Bevin): I would refer my hon. Friend to the reply given by my right hon. Friend the Secretary of State for the Home Department on 14th December, 1944, to my hon. and gallant Friend the Member for King's Norton (Major Peto).

Mr. McGovern: Is there no possibility of coming to some arrangement whereby these young men can volunteer for some other form of service?

Mr. Speaker: The Question only asks for the number.

Sir John Mellor: asked the Minister of Labour whether local appeal boards have power to recommend cancellation of directions to coalmining in cases where applicants have shown exceptional diligence and military aptitude in pre-Service training corps.

Mr. Bevin: In order to ensure the impartial operation of the ballot for coalmining, I do not accept appeals based merely on the grounds of an appellant's alleged special suitability for the Forces. The question of a recommendation on this point by a local appeal board does not therefore arise.

Sir J. Mellor: Does not this mean ignoring facts of great personal importance, and also of great importance to the war effort?

Mr. Bevin: No, Sir. Mining is essential for the war effort, and coal must be got. If Members of this House now claim that men can escape their liability for mining, the war effort must suffer.

Sir J. Lucas: asked the Minister of Labour if he will arrange that when a youth called up for the Army expresses preference for the coalfields and a cadet called up for the mines expresses preference for the Services, they may be allowed to exchange so long as both are physically qualified.

Mr. Bevin: No, Sir. With the exception of certain skilled tradesmen, youths of the requisite physical standards who express a wish to undertake coalmining as an alternative to service in the Forces are allocated to the mines. Members of pre-Service training units are not excluded, as such, from the coalmining ballot and to allow a cadet to avoid his obligations by means of an exchange, even if it were practicable, would impair the impartiality of the ballot.

Workers (Medical Certificates)

Mr. Foster: asked the Minister of Labour if he will consider abolishing the practice by which employers in many districts compel employees to produce medical certificates when off sick for one or more days, for which a charge is made by the doctors, and under which evidence of sickness is not accepted by the magistrates in prosecutions for absenteeism by his Ministry under Essential Work Orders unless supported by medical certificates, or else relieve employees in such cases of the cost of medical certificates.

Mr. Bevin: I have no power to prohibit employers from asking for medical certificates in support of absence. With regard to the charge for certificates, special arrangements have been agreed with employers' organisations, trade unions and the medical profession under which a certificate in standard form can be obtained for one shilling.

Mr. Foster: Is my right hon. Friend not aware that this charge for medical certificates is causing hardship, particularly in cases where the man is on health insurance benefit and is receiving only 18s. per week; and in view of the fact that in many cases the charge amounts to much more than 1s. a week, will he try to assist in this matter?

Mr. Bevin: The question of medical certificates and the charge for them, is really a matter for the Minister of Health. It is dealt with under the National Health Insurance scheme.

Mr. Rhys Davies: Will the right hon. Gentleman be good enough to consider the very serious problem that arises from the fact that when the average man feels sick, he does not run at once to the doctor, because he hopes to be better again in a day or two; when he is absent from work, the right hon. Gentleman's Department prosecutes him, and when he is taken to court, he is asked for a medical certificate? Will the the right hon. Gentleman not do something in this matter?

Mr. Tom Brown: Is my right hon. Friend aware that some employers of labour are carrying the matter a bit further than the certificate, and are actually asking that the first bottle of medicine shall be taken to the works after it has been received from the doctor? Is that not going a bit too far, after nearly six years of war?

Mr. Bevin: I only hope that the employer takes the medicine.

Sir Herbert Williams: Is the right hon. Gentleman aware that the Minister of Food does even worse?

Dr. Edith Summerskill: Can my right hon. Friend say why employers are not recognising National Health Insurance certificates as evidence of incapacity?

Mr. Bevin: I am afraid that in some cases National Health Insurance certificates are not conclusive evidence either way.

Port of Liverpool (Casual Employment)

Mr. Kirby: asked the Minister of Labour whether he is aware that an agreement was reached between the Warehouse Keepers' Conference, representing the Liverpool Warehouse Owners and the National Union of Distributive and Allied Workers, having for its object the elimination of the objectionable casual system of employment in the warehouses of the port; that the employers concerned have now repudiated the agreement; and how he proposes to deal with this new situation in an effort to enforce Government policy as to the discontinuance of the casual labour system in the Port of Liverpool.

Mr. Bevin: I am aware that negotiations for the conclusion of such an agreement, though not broken off, are at present in abeyance, and I am considering how the outstanding difficulties can best be removed.

Oral Answers to Questions — INDUSTRIAL RECONVERSION

Control of Engagement Order

Lieut.-Colonel Dower: asked the Minister of Labour if, in cases where under the Control of Engagement Order proposed in Cmd. 6568, an unemployed person hears through personal contact of a vacancy he will be allowed to request his local exchange that he may accept such engagement.

Mr. Bevin: Yes, Sir. Whether such a request could be acceded to would depend on all the circumstances of the case. In this connection I would refer my hon. and gallant Friend to the answer I gave to the hon. Member for Tamworth (Sir J. Mellor) on 18th January, regarding the aim of His Majesty's Government in administering labour controls after the defeat of Germany.

Lieut.-Colonel Dower: Is my right hon. Friend not aware that these men in the Forces fear that peace will bring them a form of State direction infinitely worse than that which they have been under for the last five years?

Mr. Bevin: As a matter of fact, this matter has been explained to the Forces, and I am advised that the announcement that they are to be helped in this manner is immensely popular.

Lieut.-Colonel Dower: Is the Minister aware that I met a large number of members of the Forces only last week, and that I found the overwhelming majority were in favour of being able to take the jobs which they wanted?

Building Industry (Women)

Mr. Astor: asked the Minister of Labour whether he is considering introducing women labour into the building industry after the war.

Mr. Bevin: The extent to which women should be employed after the war in the building industry is a matter for the industry itself to consider. It is not contemplated that I should be given powers to determine this question.

Mr. Astor: In view of the fact that women are now doing work of a comparable nature, will the Minister discuss the matter with the two sides of the trade, in order to have it ventilated?

Mr. Bevin: Certainly.

Sir H. Williams: Will the Minister give the House an assurance that he will not continue industrial conscription into peace time?

Mr. Bevin: Certainly.

Trade Unions (Lists of Vacancies)

Sir J. Mellor: asked the Minister of Labour if he will identify the trade union organisations which are supplied by his Ministry with lists of vacancies notified to the Appointments Department.

Mr. Bevin: The trade union organisations concerned are the National Federation of Professional Workers, and the Association of Engineering and Shipbuilding Draughtsmen.

Sir J. Mellor: Would it not be to the advantage of all concerned if the commercial fee-charging agencies could also be supplied with these lists?

Mr. Bevin: No, Sir. People are on the list because they represent special technicians—as in the case of architects and other professions, whose organisations know the ability of their members, which fee-charging agencies, in the case of industry, do not.

Sir J. Mellor: Does the right hon. Gentleman mean that fee-charging agencies are not excluded merely because they charge fees?

Mr. Bevin: No, Sir.

Ex-Servicemen (Bankers' Advice)

Major Sir Jocelyn Lucas: asked the Minister of Labour if, as part of his demobilisation plans, arrangements will be made with the big banks that local managers should give advice to ex-Servicemen desirous of setting-up in business on their own account.

Mr. Bevin: I am grateful to the hon. and gallant Member for this suggestion. I attach great importance to the provision of facilities to enable ex-Servicemen to get the best available advice and I will consider my hon. and gallant Friend's proposal.

Colonel Sir A. Lambert Ward: Is it not a fact that managers of banks are disqualified from giving advice on the setting-up of businesses, and, moreover, if the advice were followed might it not easily result in serious loss to the man who had set up in business?

Appointments Department

Mr. Silkin: asked the Minister of Labour whether, since the Appointments Department was reorganised at the beginning of last month, there has been any change in its function as regards restrictions on engagements.

Mr. Bevin: No, Sir. It is not and never has been our intention that, in general, the engagement of persons for employment in administrative, managerial or executive capacity should be controlled after the termination of hostilities in Europe.

Scheduled Employment (Release Applications)

Mr. Mainwaring: asked the Minister of Labour whether he will arrange that, in districts where redundancy of labour is already in evidence or likely to occur in the near future, persons seeking release from the operations of the Essential Work Order will not unduly be refused permission to leave their present jobs in order to return to business or former occupation; and will he discuss this point with other Government Departments affected.

Mr. Bevin: While the needs of war production and of essential services are still so pressing it is not possible to alter the present practice. I would remind my hon. Friend that national service officers take account of all relevant considerations when considering individual applications to leave scheduled employment on grounds of hardship.

Mr. Mainwaring: Does not my right hon. Friend appreciate the difficulty which arises in a district where such a situation exists, of justifying the retention of some people in work, and the retention of others on unemployment benefit?

Mr. Bevin: I know that difficulties arise, but I cannot relax the Order until the war is over.

Oral Answers to Questions — LONDON POWER COMPANY, LIMITED

Sir Waldron Smithers: asked the Minister of Labour, if he will cause an inquiry, under an independent chairman at which evidence can be taken on oath, to be held concerning Mr. L. W. Langdale's allegations against the London Power Company, Limited, of which particulars have been sent to him.

Mr. Bevin: No, Sir.

Sir W. Smithers: Is it not inherent in British justice that a man in this position should be heard? The allegations are serious. Is the Minister not aware that my constituent is prepared to face a public inquiry, and would it not be in the interests of justice that these serious allegations should be either substantiated or withdrawn?

Mr. Bevin: That is another question.

Oral Answers to Questions — BRITISH ARMY (JOINT RELEASE COMMITTEE)

Sir Ronald Ross: asked the Minister of Labour whether he is aware that on joint release committees of the Fighting Services which consider cases of citizens of Northern Ireland, the Northern Ireland Ministry of Labour is unrepresented whereas a representative of the British Ministry of Labour is one of the tribunal and that in certain instances this official, who is without authority as to citizens of Northern Ireland or knowledge of conditions in Northern Ireland, has overruled recommendations of Northern Ireland Departments; and whether, as labour is a transferred service, a representative of the Northern Ireland Ministry of Labour will be substituted for a representative of the British Ministry of Labour in such cases.

Mr. Bevin: As I informed my hon. Friend on 24th January, any necessary information regarding an application for the release of a member of the Armed Forces for work in Northern Ireland is furnished by the appropriate Department of the Government of Northern Ireland. The principles to be followed, in deciding whether the facts put forward in support of an application justify a favourable recommendation to the Service Departments, are the same for Northern Ireland as for Great Britain. I do not

consider, therefore, that any change is necessary in the existing procedure which has worked satisfactorily.

Sir R. Ross: Is the Minister willing that people should be deprived of their constitutional rights because they have volunteered to serve in the Armed Service; and are citizens of Northern Ireland not entitled to have their cases adjudicated upon by their own Ministry of Labour?

Mr. Bevin: The arrangements between us and the Northern Ireland Government have been worked out by the two Departments. I am not aware that there is any ground for the statement which the hon. Gentleman has just made.

Sir R. Ross: Is the Minister not aware that his representatives on these committees overruled the recommendations of the Department of Northern Ireland, who know the facts?

Mr. Bevin: I should be very glad to have some information on that point.

Oral Answers to Questions — PENSIONS APPEAL TRIBUNALS

Lieut.-Colonel Sir Ian Fraser: asked the Minister of Pensions how much delay there is between the date when an ex-Serviceman or woman makes application for an appeal and the time when it is heard by the appeal tribunal.

The Minister of Pensions (Sir Walter Womersley): It is not practicable in present circumstances to arrange for appeals to be dealt with as expeditiously as would be wished, but every endeavour is made to deal quickly with those cases in which an early decision is specially desirable. As my hon. and gallant Friend is aware, when I introduced the Pensions Appeal Tribunals Bill I indicated that nine tribunals would be set up: by the end of this month 17 will be sitting and from this it will be seen that it has been found possible to deal with a considerably greater number of cases than was originally contemplated.

Sir I. Fraser: Is the Minister aware that the Chairman of the British Legion stated recently that the delay was sometimes between nine and eleven months? When a man comes out of the Service disabled or ill if it is to take nearly a year before the whole of his life can be settled, that must constitute a very great hardship.

Sir W. Womersley: I am aware that that statement has been made. I am not able to confirm it or deny it. All I can say is that we give preference to those who are the most severely disabled, believing it is better that those who are really going to suffer most by reason of delay, should have first turn. In the case where the disablement is very slight, where a man is at work and is not suffering any financial disability thereby, he has to go down the list, and it may be some considerable time before his case is heard.

Mr. Glenvil Hall: Is it possible to increase the number of tribunals, in view of the fact that there is a real grievance here?

Sir W. Womersley: I explained to the House at the time the Act was introduced, and I have explained dozens of times since, that there would be delays. As the man-power position was so difficult, I did not anticipate getting more than nine tribunals. The fact that I have got 17 going shows that I have done everything I can to expedite this matter.

Mr. Evelyn Walkden: Is not this matter more serious than the Minister indicates? If it is taking from nine to eleven months to deal with cases now, and there are 17 tribunals operating, what is to be the position on general demobilisation, when cases of aggravation are bound to be numerous?

Sir W. Womersley: When we get demobilisation, we can get more tribunals.

Mr. Walkden: Not 17 but 77 tribunals will be needed then.

Mr. Lipson: asked the Minister of Pensions how many claims for pensions made by widows of members of the Forces who have died of cancer have been granted by Pensions Appeal Tribunals; and how many refused.

Sir W. Womersley: Forty-three such cases have been allowed by tribunals and 465 disallowed.

Mr. Lipson: In view of the varying results of appeals to the tribunals, is there not an additional reason why, when a man in the Forces has died of cancer, his widow should, of right, be given a pension since at present some get one and others do not?

Sir W. Womersley: If it can be shown that service has in any way aggravated the disease, even to a small degree, then a pension is given to the widow. The hon. Member asked me a question about tribunals, not about the number of cases in which we have granted pensions without tribunals.

Mr. Stephen: Will the Minister say that all cases that have been heard by the tribunals will be reviewed, in the light of the decision at the Court of Session, which says that the onus of proof is on the Minister?

Sir W. Womersley: That decision does not alter the position one iota. The onus of proof is not on the person making the application. It has been on the Minister ever since this House decided to that effect.

Oral Answers to Questions — PENSIONS AND GRANTS

Mr. Summers: asked the Minister of Pensions if he will amend the regulations governing the payment of disability pensions to men still in hospital, so as to enable them to draw the full amount to which they are entitled, after taking account of maintenance charges, thus putting an end to the practice of accumulating sums to be handed over on release from hospital.

Sir W. Womersley: I do not share the view apparently held by my hon. Friend that it is undesirable to accumulate a balance for the man's assistance on his discharge from hospital, but in any event there are good medical grounds for limiting the amount of pocket money available to patients under treatment.

Mr. Summers: Is the right hon. Gentleman aware that great objection is taken to this withholding of money to which disabled men are entitled? Will he reconsider the matter?

Sir W. Womersley: I am not aware of that fact. I have made very close inquiries. I find that when a man is discharged from hospital he is very glad indeed to have a considerable sum of money at his disposal.

Commander Sir Archibald Southby: Will the Minister give further consideration to this matter? If this money belongs to the man, is there any reason why he should be treated like a child, and not allowed to have it?

Sir W. Womersley: It is not a question of treating a man like a child at all. He is provided with all he needs while he is in hospital, including frequent free distributions of cigarettes. There is nothing on which he can spend the money. We look after his wife and children, if he is a married man, and see that they get the proper allowances. Our experience is that it is much more desirable for a man to have a sum of money when discharged from hospital, than that he should spend it on goods which are unnecessary.

Mr. Summers: In view of the nature of the reply, I beg to give notice that I shall raise this matter on the Adjournment.

Mr. Lipson: asked the Minister of Pensions if he has considered the representations made to him from a widowed mother whose son joined the Army at the age of 19 and has since been killed, and for whom she has received no pension; and will he give further consideration to the request that the Royal Warrant be amended to enable pensions to be paid in instances of this kind.

Sir W. Womersley: I am unable to trace a refusal of pension to this mother. Indeed, according to the letter forwarded to me by my hon. Friend, the son to whom she refers has not been killed: nor is he now in the Army.

Mr. Lipson: Has not my right hon. Friend misread the letter? The son who is not in the Army, and who has not been killed, is another son. This son was in the Yeomanry and was killed. On the general question, is the Minister now prepared to amend the Royal Warrant to enable pensions to be paid to widowed mothers of unmarried sons?

Sir W. Womersley: I have not misread the letter. It was received by me on the 5th. The Question was on the Order Paper on the 5th. That did not give me much time to consider the matter, and in preparing my reply I had to rely on the letter itself, without making further inquiry. As regards the general question, the answer is, "No, Sir."

Mr. Lipson: In view of the nature of the reply, I beg to give notice that I shall raise the matter on the Adjournment.

Mr. E. P. Smith: asked the Minister of Pensions whether he will consider making provision whereby ex-Servicemen

in receipt of a disability pension, and who marry after their disability, shall be entitled to family allowances as if they had married prior to their disability.

Sir W. Womersley: I would refer the hon. Member to my reply to the hon. Member for Inverness, Western Isles (Mr. H. MacMillan) on 19th December last, of which I am sending him a copy.

Mr. Smith: Is the Minister aware that there is a very strong feeling in the country that a young man should not be financially barred from marriage because he happened to have been disabled in the service of his country?

Sir W. Womersley: There is no financial bar. There are other arrangements, as the hon. Member may know. If he does not know of them, I will inform him if he will see me after Questions.

Oral Answers to Questions — INDIA

Officers, Indian Army (Transfer)

Sir J. Mellor: asked the Secretary of State for India whether he can now give an assurance that officers who were compulsorily commissioned in the Indian Army will be enabled, if they wish, to transfer forthwith to the British Service.

The Secretary of State for India (Mr. Amery): The matter is still under consideration with the War Office and I am not yet in a position to add to my earlier replies on the subject.

Legislative Assembly Members (Restrictions)

Mr. Sorensen: asked the Secretary of State for India how many members of legislative assemblies are now subject to village or house restriction and therefore not able to attend their respective assemblies; and the approximate total number of members of legislative assemblies who cannot fulfil their duties owing to the imposition of legal penalties or restrictions.

Mr. Amery: The desired information is not available here. The hon. Member will appreciate that his Question does not apply to the persons referred to in my reply to his question on 1st February, since the Provincial Legislature in Bihar, as in five other Provinces, is not at present functioning.

Mr. Sorensen: Does not the right hon. Gentleman feel that it is undesirable that members of public bodies should be debarred from exercising their civic functions?

Mr. Amery: They debarred themselves by their own action.

Indian Industrialists (Visit to United Kingdom)

Sir Stanley Reed: asked the Secretary of State for India whether he has any further information as to the date when the proposed visit of a group of Indian industrialists to this country is likely to take place.

Mr. Amery: I understand that after further discussion with the group it has now been decided that they will leave India for their visit to this country early in April.

Mr. Sorensen: Can the right hon. Gentleman say what is the composition of this group?

Mr. Amery: It is a small body of leading Indian industrialists. They have, of course, arranged their own composition.

Sir Ralph Glyn: Will special care be taken to see that these Indian industrialists have accommodation and proper arrangements for travelling where they wish, when they do arrive?

Mr. Amery: I am sure that everything necessary will be done in that respect.

Mine Work (Women)

Mr. Sorensen: asked the Secretary of State for India how many women are now employed in mining; what are the present rates of payment; and whether steps can now be taken to bring such employment to an end.

Mr. Amery: I am asking the Government of India for up-to-date figures of the number of women employed in mining. Rates of pay for women working underground are the same as for men. They vary according to a number of factors and average about 12 annas per day in the types of work on which women are mainly employed. In addition they receive attendance bonus and grain concession of an average value of 6 annas per day. The question of the continued employment of women underground is

under the Government of India's consideration and I expect shortly to be informed of their conclusions.

Mr. Sorensen: Does it not work out that the women, in fact, get from 1d. an hour upwards for their work? Could the right hon. Gentleman say, in general terms, whether there has been a reduction in the number of women employed?

Mr. Amery: I cannot say, but I will try to get figures. As to the rates of pay, they compare favourably with those of other industries in that part of India.

Sir H. Williams: Will my right hon. Friend bear in mind the view of women Members of Parliament, that women should take part in every occupation?

Dr. Edith Summerskill: Can the right hon. Gentleman answer a question which I have asked him on two other occasions—whether expectant mothers are prohibited from going underground?

Mr. Amery: Yes, Sir. I understand that expectant mothers are prohibited from working for a month before and a month after delivery, and that they receive maternity benefit during that time.

Mr. Stephen: Are representatives of these women included in the industrial group coming to this country?

Mr. McGovern: Is there any intention of abolishing this abominable form of industrial slavery?

Mr. Amery: Work in the mines is entirely voluntary, and the Government of India are just as anxious as we in this House are not to continue that work any longer than is necessary. But coal deliveries at present are one of the most serious limiting factors of India's war effort.

Mr. Sorensen: May we take it that women can, and do, take their babies down the mines a month after birth?

Mr. Amery: I do not know. There is no reason why they should. Maternity pay is continued for a month after the birth, and the women are forbidden to work at any rate during that period.

Earl Winterton: Are not the owners of these mines among the most prominent supporters of Congress, and ought they not, therefore, to be very friendly with hon. Gentlemen on the Labour benches?

TAXI-CABS (DRIVER'S COMPARTMENT)

Sir A. Southby: asked the Secretary of State for the Home Department whether he is prepared to amend the regulations regarding taxi-cabs, so that the drivers may be completely enclosed, as is the case with omnibus drivers.

The Secretary of State for the Home Department (Mr. Herbert Morrison): So far as the Metropolitan Police district is concerned, there is nothing in the prescribed conditions as to construction of taxi-cabs to prevent the enclosure of the driver's compartment.

Sir A. Southby: Is the right hon. Gentleman aware that the taxi-drivers themselves believe that the reason the driver's compartment is not enclosed is that the Home Office refuse to accept the design of a cab which includes such a feature?

Mr. Morrison: I think my answer will make it clear to them that they are under a misapprehension.

Sir Ernest Shepperson: Will the right hon. Gentleman so amend the regulations that Members of this House will have the opportunity to get a taxi to go home at night?

LIGHTING RESTRICTIONS

Mr. Thorne: asked the Secretary of State for the Home Department if he will now consider doing away with blacking-out of private homes, offices, and all public buildings.

Mr. H. Morrison: I have this matter constantly under consideration, but I do not yet see my way to accept my hon. Friend's suggestion.

Mr. Bowles: May I ask my right hon. Friend the Prince of Darkness, whether he has looked into the allegation that I made on the Adjournment before Christmas, that the Air Ministry's buildings, eight storeys high, on Kingsway, were fully lighted two hours after black-out? Has he officially advised the Air Council, and, if so, does he think that they are carrying out their obligations?

Mr. Morrison: I have no doubt that the Air Ministry have noted my hon. Friend's observations. As to the rest of his speech, I thought I had dealt very faithfully with it at the time.

Mr. Thorne: Is my right hon. Friend aware that if the black-out were done away with a vast amount of black-out material could be saved, and used for other purposes?

Mr. Morrison: That is a factor which is taken into account; but we must bear in mind that if the black-out were fully abolished, it might be easier for the enemy, by Heinkel aircraft, to drop fly-bombs on my hon. Friend's constituents.

Mr. Keeling: asked the Secretary of State for the Home Department whether he is aware that public exhortations to save electric current lose much of their effect in places where street lamps remain lit throughout the day; and whether he will cause local authorities not to light street lamps at all whenever, owing to the shortage of labour or material, the lights cannot be turned out.

The Minister of Fuel and Power (Major Lloyd George): I have been asked to reply. As my hon. Friend is aware, the Government decided that in this, the sixth, winter of the war some alleviation of the street lighting position was not only permissible but desirable; and on 19th January I informed my hon. Friend the Member for Holborn (Sir R. Tasker) that, in some areas, there could be no alternative in present circumstances between continuous lighting and no lighting at all. Local authorities are well aware of the need for the utmost economy in all forms of fuel and, as the Government's concession does not involve a serious increase in consumption, I should hesitate to fetter their discretion by further controls and Orders. The fact that, owing to wartime difficulties, continuous lighting is sometimes unavoidable does not justify in any way waste or extravagance in the use of fuel by individuals.

Mr. Keeling: Will the right hon. and gallant Gentleman make it clear that this Question, when it was put down on the Order Paper, was addressed to him? Does his unsuccessful attempt to "pass the buck" to the Home Secretary mean that he is in disagreement with the Home Secretary and, if so, will he refer the matter to the War Cabinet?

Hon. Members: Answer.

Mr. Speaker: rose—

SERVICE FRANCHISE (PROXIES)

Lieut.-Colonel Sir Thomas Cook: asked the Secretary of State for the Home Department to what extent men and women in the Forces have exercised their right to appoint a proxy for voting.

Mr. H. Morrison: I regret that detailed statistics about this matter are not available, but my information is that approximately four-fifths of those who have completed declaration cards have appointed proxies.

SENTENCE, BURSLEM

Dr. Edith Summerskill: asked the Secretary of State for the Home Department if he will review the case of Mrs. Key, aged 54, of Burslem, who was sentenced to 14 days imprisonment for harbouring her son, an Army deserter; and, as there was evidence that she had endeavoured to persuade him to return to his unit, if he can see his way to remit the remainder of the sentence.

Mr. H. Morrison: My information is that Mrs. Key had been harbouring her son for over three years, from September, 1941, until his arrest as a deserter in January, 1945. I have had inquiry made, following upon representations by the hon. Member for Burslem (Mr. MacLaren) and have reviewed all the circumstances of the case, but I regret that I can find no sufficient grounds to justify me in recommending any remission of the sentence passed by the justices.

Dr. Summerskill: Is it not a fact that this woman endeavoured on many occasions to persuade her son to return, and that he refused to do so; and is she not a highly respectable woman? Surely, she was simply displaying her maternal instincts, which perhaps rather ran away with her reason. Therefore, should not this case be regarded with some compassion?

Mr. Morrison: I believe it is fair to say that this lady did try to persuade her son to go back to his unit, but he was with her for three years, so she does not appear to have been very successful. If I remit this sentence, which I believe is 14 days, I am myself, by administrative action, amending the law. If the law is to be amended, it should be amended by Parliament.

Mr. Woodburn: Does my right hon. Friend not think that this case is analogous to the law which does not require wives and mothers to give evidence against their husbands and sons; and would it not be wise to consider whether the violation of natural feelings should be used as a punishment? Should not the man be punished, instead of the mother, who is being used as a kind of hostage?

Mr. Morrison: That is a perfectly fair point, but it is a question of the law. For the law I am not departmentally answerable—that is a matter for the Secretary of State for War.

Mr. Silverman: Why is it that, while this woman has committed an offence by harbouring her son, in her own house presumably, for over three years, nobody knew that he was there all that time?

Mr. Morrison: I have not the least idea.

Mr. Silverman: Could not my right hon. Friend inquire? If the son was in the house for three and a half years, somebody else must have connived at it. Should not that person be blamed, instead of the mother?

Mr. Morrison: She did not inform the authorities, so that of course she must have connived at it.

Mr. Silverman: I said "somebody else."

Mr. McGovern: What do the Government expect the woman to do—denounce her son? Is not this the sort of thing that you condemn families in Germany for doing, under the Gestapo? Would it not have been better for the mother to have sent her boy to hide in the orchard, near London, where the right hon. Gentleman hid during the last war?

Mr. Morrison: I appreciate my hon. Friend's wish, as usual, to be rude. It does not worry me. It is the nature of the law which is involved; and the law is not a matter for me, but for the Secretary of State for War.

POLICE FORCES (AMALGAMATION)

Lieut.-Commander Joynson-Hicks: asked the Secretary of State for the Home Department whether he is aware of the handicap to their development imposed on police forces affected by the Orders made


under the Defence (Amalgamation of Police Forces) Act, 1942, owing to the present temporary basis of such forces; and whether he is yet in a position to make a statement on the matter.

Mr. H. Morrison: I regret that I am not yet in a position to add anything to the reply I gave to my hon. and gallant Friend on 7th December last.

RACECOURSE BETTING CONTROL BOARD

Sir R. Glyn: asked the Secretary of State for the Home Department who has been appointed Chairman of the Racecourse Betting Control Board; who are the other members; what was the date of the last published report of the affairs of this Board; and, if Parliament can now be informed, in accordance with the Act that set up their organisation, what has been done, and at what cost.

Mr. H. Morrison: Since the death of Sir Clement Hindley, no appointment has been made to the chairmanship of the Board, but my hon. Friend the Member for Hendon (Sir R. Blair) is acting as Chairman. Apart from the Chairman, the Board consists of 11 members, the names of whom I will, with permission, circulate in the OFFICIAL REPORT. A report of the proceedings of the Board, together with a statement of their accounts, has been presented annually to Parliament, in accordance with the Racecourse Betting Act, 1928. For reasons of economy, the reports for the years subsequent to 1939 have not been printed, but I understand that my hon. Friend has now been supplied by the Board with copies of these reports.

Sir R. Glyn: Is it not rather peculiar that a Parliamentary Paper, which should be laid annually, is not laid, for reasons of economy? Are there other examples in which it is incumbent to lay papers and in which papers have not been laid?

Mr. Morrison: Quite a number. Because of the need for economy, difficulties arising from the war effort, and the shortage of paper, that is quite common in these days.

Colonel Sir Charles MacAndrew: Is my right hon. Friend aware that in the Library

of the House there is a copy of the Report of the Racecourse Betting Control Board?

Mr. Morrison: I believe that that is so, and I am much obliged to my hon. and gallant Friend for drawing attention to it.

Sir R. Glyn: Is there a list of documents which have not been presented to Parliament?

Mr. Morrison: I could not say. There is a considerable number of Departments involved.

Following are the names:

MEMBERS OF THE RACECOURSE BETTING CONTROL BOARD

Names and Appointing Authorities

Sir Reginald Blair, D.L., M.P., J.P.—The Secretary of State for the Home Department.
Colonel Sir Charles MacAndrew, M.P.—The Secretary of State for Scotland.
The Hon. Alexander Parker—The Minister of Agriculture and Fisheries.
General Sir John DuCane, G.C.B.—The Chancellor of the Exchequer.
The Rt. Hon. Lord Hamilton of Dalzell, K.T., C.V.O.—The Jockey Club.
The Rt. Hon. Lord Portal, D.S.O., M.V.O.—The Jockey Club.
The Rt. Hon. the Earl of Rosebery, D.S.O., M.C.—The Jockey Club.
Mr. E. L. Gosling—The National Hunt Committee.
Mr. E. Holland Martin—The National Hunt Committee.
Mr. E. E. Robinson—The Racecourse Association, Limited.
Mr. W. E. Fry—The Committee of Tattersalls.

SUMMER TIME (GAS AND ELECTRICITY CONSUMPTION)

General Sir George Jeffreys: asked the Secretary of State for the Home Department whether he is aware that the excessive consumption of gas and electricity between the hours of 8 and 10 a.m. is largely due to the continuance of summer time in midwinter; and whether he will arrange for reversion to Greenwich mean-time from October to February, inclusive.

Mr. H. Morrison: I am informed by my right hon. Friend the Minister of Fuel and Power that any increased consumption of gas and electricity in the morning is more than offset by the saving in the evening; but, as I pointed out last week in reply to my hon. and gallant Friend the Member for Carnarvon (Sir G. Owen), the overriding consideration in favour of this


special wartime arrangement has been that it has facilitated the work of supplying the needs of the Armed Forces.

Sir G. Jeffreys: Is the right hon. Gentleman aware that, in Summer Time, between the hours of 8 and 9 a.m., it is dark and that, between those hours, people have to cook, dress, go to business, and children have to be got ready and sent to school; and is it not absolutely certain, especially during hard weather such as we have had recently, that an undue amount of fuel must be consumed?

Mr. Morrison: It is true that there was darkness during part of that period, but it is not true of any part of the period at the moment. The fact is that, on fuel consumption, the evenings balance the mornings, and there is nothing in it from the point of view of fuel economy.

Mr. Snadden: Is the Minister aware that the imposition of this measure imposes a great hardship on the production of foodstuffs, and especially on milk production; and will he give an undertaking that the iniquitous infliction of Double Summer Time is not going to be reimposed?

Mr. Morrison: That is really another point, but that aspect of the matter will be fairly considered.

Sir C. MacAndrew: As regards fuel consumption in the morning and evening, is it not the case that lights are left on in the mornings longer than is actually necessary, whereas in the evening they are not turned on until actually required?

Mr. Morrison: I have taken advice from the Ministry of Fuel and Power. Departmentally, they are the experts, and they tell me that my presentation of the facts is correct.

Colonel Greenwell: Is not the main question that the peak load occurs in the morning?

Mr. Morrison: There is a peak load in the evening.

MARRIED WOMEN (NATIONALITY)

Mrs. Cazalet Keir: asked the Secretary of State for the Home Department whether the Government will now consider implementing the policy declared in 1931 by introducing legislation to allow British women to retain their nationality on marriage to an alien.

Mr. H. Morrison: It is not possible for His Majesty's Government to introduce such legislation without prior consultation with the Dominions. No suitable opportunity for consultation has occurred, but the matter will not be overlooked.

Mrs. Keir: May I ask the right hon. Gentleman whether he will undertake to try to see that this matter is placed on the agenda at the next Imperial Conference?

Mr. Morrison: I will do my best, and I would certainly like it to be there, but, of course, it must depend on how much pressing business there is before that Conference.

Miss Rathbone: May I ask the right hon. Gentleman whether it is right that this long-standing grievance should continue because the people of Eire do not want women to have the rights which other countries have secured; and is it desirable that women married to Allied nationals should be in a worse position than women married to enemy nationals?

Mr. Morrison: I am not sure if my hon. Friend has made a correct statement of the facts about Eire, but I think the House will agree that it is desirable that citizenship of the nations of the British Commonwealth should stand on the same basis if we can possibly do it.

REMAND HOMES (INQUIRY)

Mr. Keeling: asked the Secretary of State for the Home Department whether, in view of the valuable expert testimony given by magistrates, probation officers and others, as to the conditions which should prevail in remand homes, he will publish the evidence given at the recent London inquiry, with such excision of names as he thinks advisable.

Mr. H. Morrison: I would refer my hon. Friend to the reply which I gave to my hon. Friend the Member for The High Peak (Mr. Molson) on 7th December. I then said that the inquiry would be searching and comprehensive, and the report would include a fair and adequate review of the evidence given. When hon. Members have read the report, I am sure they will agree that these promises have been amply fulfilled and that there would be no justification for the labour and expense which would be involved if—contrary to the usual practice—the evidence were published as well as the report.

Mr. Keeling: As the Minister bases his negative reply on labour and expense, will he place one copy of the evidence in the Library, and give another to the Press Association?

Mr. Morrison: No, Sir. I should not be willing to give a copy to the Press Association, and I am very doubtful about putting one in the Library.

Hon. Members: Why?

Mr. Morrison: I think one might get partial extracts in that case. It would be fairer for hon. Members to see the report, when they can judge for themselves. I cannot understand why I am being pressed to take an unusual course.

Mr. Molson: Will the Minister keep his mind open upon this subject until we have seen the report, and then, if we think right, we can make representations to him upon it?

Mr. Morrison: My mind shall remain as much open as the mind of my hon. Friend.

Mr. Douglas: Is it not most unusual for such evidence to be published; and is the object of hon. Members to question the impartiality of the tribunal, or to make party capital out of the report?

Sir W. Smithers: Can the right hon. Gentleman say when the report will be published?

STREET OBSTRUCTIONS (ACCIDENTS)

Mr. Hynd: asked the Secretary of State for the Home Department what party is responsible for the provision of red lights or other measures to ensure the protection of the public against accidents due to accumulations of debris, repair materials, etc., left at night on the streets near bomb damage.

Mr. H. Morrison: There are a number of legal requirements regarding obstructions in the street which it is impracticable to specify as they vary from place to place. London local authorities were asked in December to arrange for their contractors to remove rubble or to light any heap of material or rubble left on the highway. Private owners carrying out repairs to their own homes will also, I hope, take all possible steps to avoid the risk of accidents.

Mr. Hynd: Can we take it that the contractors, in the case of private owners carrying out their own repairs, are legally liable for the prevention of these accidents; and is the Minister not aware that there is considerable confusion as to who is actually responsible?

Mr. Morrison: I do not think it would be wise for me to express an opinion on what is essentially a matter of law.

ILL-TREATMENT OF CHILDREN (PENALTIES)

Mrs. Tate: asked the Secretary of State for the Home Department whether he is aware of the inadequacy of the penalties able to be inflicted on persons who maltreat children entrusted to their care; and, in view of the indignation thus created whether he will consider revising the scale of penalties which it is possible to impose for various types of crime to bring them into line with modern social views and ethics.

Mr. H. Morrison: Under the existing law, a person convicted of ill-treating or neglecting a child is liable on summary conviction to six months' imprisonment or a fine of £25, or both, and on conviction on indictment to two years' imprisonment or a fine of £100, or both. Such complaints as reach me have been to the effect either that, where a mother's neglect is due to ignorance or lack of training, imprisonment is an inappropriate sentence, or that, in some particular case, the Court has not made full use of its existing powers and has imposed a sentence which is much below the maximum authorised by law. I can find no ground for any alteration of the existing law, which is contained in an Act passed by Parliament in 1933, but I fully share the feelings of indignation which any deliberate maltreatment of children naturally and properly excites, and if in any such case Magistrates fail to carry out their duty of imposing an appropriately deterrent sentence—while I have no power to intervene or to call them to book—I recognise that it is right that public attention should be called to the matter so that the magistrates may realise that their action is condemned by public opinion.

Mrs. Tate: Is the right hon. Gentleman aware that, although the country has bees gravely shocked by the three cases


brought to light recently, the National Society for Prevention of Cruelty to Children tell me that they had over 1,000 cases last year, many of which it was impossible to get reported in the Press, owing to lack of space, and very many of which they consider were very inadequately dealt with; and will he, therefore, consider what steps should be taken to see that benches which do not deal adequately with these cases, should have this matter drawn to their attention?

Mr. Morrison: On the Press reports, and the representations of the hon. Member for Wallasey (Mr. Reakes), I asked that inquiries and a report should be made. I have not yet received it, and it would not be right for me to express an opinion upon the merits of the case, but I must warn the House that this issue has to be faced—whether the courts are to function as courts of law, independent of the Executive, or whether the House wishes to get into a position in which the Home Secretary gives instructions to the courts.

Mr. A. Bevan: Would it not be extremely improper for the mind of the bench having to try one of these cases in the immediate future to be inflamed into indiscretions, abuses and excesses by the clamour of popular feeling?

Mr. Morrison: I think there is point in what my hon. Friend says. The courts must be judicial and find the proper penalty, and any undue tendency towards hysteria in this matter is to be deplored.

Mr. Benson: Will the Minister realise that heavy sentences are an entirely inadequate substitute for proper inspection?

Mr. Godfrey Nicholson: Is it not a pity that attention should be diverted by particularly hard cases, when the real problem is the way in which orphan children, or those who are under guardianship, are being dealt with?

Mr. Morrison: I think I told my hon. Friend last week that that is why the Minister of Education, the Minister of Health and myself had asked the Government to institute an inquiry.

BOARDED-OUT BOY (SHROPSHIRE)

Mr. Lindsay: asked the Secretary of State for the Home Department on what authority the boy Dennis O'Neill

was boarded out at Bank Farm; and when the boarding-out conditions were last inspected.

Mr. H. Morrison: This boy had been committed to the care of the Newport county borough council and the council, I am informed, arranged in June, 1944, for him to be boarded out at Bank Farm, Minsterley, Shropshire. I understand that the boy was taken to his foster home by an officer of the education authority when he was placed there in June, and was visited by another of the authority's officers on 20th December, 1944. I have already called for a full report on the case.

Mr. Silverman: Does the right hon. Gentleman realise that this boy was taken away from his home on the alleged ground that he was in need of care and protection, and in those circumstances how does it come about that he was placed where the care and protection afforded him were evidently no greater than he got at home?

Mr. Morrison: I have called for a report on the case and I ought not to express an opinion before I have considered it, but in the meantime I would inform my hon. Friend that the responsibility for its inspection under the law is the responsibility of the Newport county borough council.

EDUCATION

School Sites (Price)

Mr. Glenvil Hall: asked the Minister of Education the area of the land adjoining South Hornchurch Council school which the Essex County Council has decided to acquire for £1,800 to provide another department to the school; and the value at which this land has been assessed for local taxation.

The Minister of Education (Mr. Butler): The area of the site in question is one acre, one rood, 16 poles; the land being agricultural land has not been rated at all. I understand that the local education authority has now decided, in response to the Ministry's suggestion, not to acquire this land immediately but to apply for its reservation under the Town and Country Planning Acts until needed for educational development.

Mr. Hall: Do I understand from that reply that this authority will get the land more cheaply than at the present excessive price?

Mr. Butler: I really cannot say.

Mr. Glenvil Hall: asked the Minister of Education, in view of the proposals of the Devon County Education Committee to purchase land in the following seven towns for the extension of school buildings or the building of new schools, Axminster, Bideford, Crediton, Cullompton, Ilfracombe, Sidmouth and Tavistock, whether sites have been, or are being, acquired in any of these towns either by negotiation or compulsory powers; and whether he can state the area, the price and the previous rateable value of each of the sites in question.

Mr. Butler: The Devon local education authority have submitted a proposal to acquire by negotiation about 16 acres of land at Crediton for the erection of a modern secondary school, which is under consideration. The site is agricultural land and has not been assessable for rates. I understand that the authority are negotiating for a site for a new school at Tavistock, though no proposals have reached my Department. My only other information is that the authority have sites in mind for new schools at Axminster and Bideford, but have not yet entered into negotiations for the purchase.

Mr. Hall: May I ask the right hon. Gentleman if it is possible for his Department to buy land for schools in this way privately so that the authority or the individual owning it does not know that the public authority require it and therefore they might get it more cheaply?

Mr. Butler: I should have to look into that matter.

Direct Grant Schools

Mr. Edmund Harvey: asked the Minister of Education whether provision will be made to permit independent schools, otherwise qualified to receive a direct grant, which have not yet been placed on the direct grant list to have their applications considered under the new regulations otherwise than in accordance with the proposals of Scheme B of the Fleming Report.

Mr. Butler: I must ask my hon. Friend to await an announcement of the conditions

for direct grant schools which have not yet been finally settled.

Mr. Harvey: Can my right hon. Friend say when the announcement is likely to be made?

Mr. Butler: When we are ready to make the announcement.

Mr. Oldfield: asked the Minister of Education whether, under his regulations after 1st April, a local education authority will be able to continue its aid to a direct grant school on the basis of a capitation grant without getting his approval; and if he proposes to insist that, as a condition of this assistance, the school shall abolish its fees.

Mr. Butler: Where a local education authority proposes to assist a direct grant school the arrangements will need to be authorised by my department in accordance with the provisions of Section 9 (1) of the Education Act, 1944. The school will not be required, as a condition of such assistance, to abolish tuition fees.

LIBERATED TERRITORIES (RELIEF SUPPLIES)

Earl Winterton: asked the Prime Minister if he will cause a Command Paper to be published showing, on the information of British representatives, the amount of malnutrition and lack of commodities essential for health in France and the freed portions of Belgium and Italy; how far this is due to allied military requirements of ships and rolling stock; and the steps being taken to relieve the situation.

The Deputy Prime Minister (Mr. Attlee): The responsibility for the provision of commodities essential to health for liberated territories during the military period is one for the Combined United Kingdom/United States military authorities. In making their preparations, these authorities have, naturally, had to take into account the severe limitations imposed by shipping, port capacity, and internal transportation. These factors have greatly increased the difficulties of dealing with the situation, and it has, therefore, not yet been possible to maintain, or even to reach the full standards aimed at in all cases. But the reports received do not indicate any serious malnutrition, except in certain areas where


it existed before liberation. In areas where fighting has recently taken place, it is particularly difficult to restore the disrupted distributive system. The combined military authorities are, however, making special efforts to effect such improvements as are possible in present conditions. At the present time, I do not think there would be any advantage in issuing a White Paper on these matters.

Commander Locker-Lampson: Could not an hon. Member of this House be allowed to go to France to see for himself?

Earl Winterton: In view of the fact that independent evidence completely contradicts what the right hon. Gentleman says, and is to the effect that millions of people are on the verge of starvation and in a worse state than they were under German occupation, how can the right hon. Gentleman refuse to publish information, and is it not the case that members of the Forces would not want to avail themselves of leave trains or N.A.A.F.I. supplies, if they were doing so at the expense of starving French babies?

Mr. Attlee: The question is based on an assumption which is entirely groundless.

Earl Winterton: It is not.

Mr. Attlee: There are no leave trains interfering with the supply of commodities. What I have stated is based on the facts known to us from official reports, that we have received on conditions. I agree that conditions are not as we would wish them to be but there is really no point in making exaggerated statements. If my Noble Friend has any evidence he would like to bring forward, and would submit it to myself or to my right hon. Friend we should be very glad to have it. I am trying to give what we know, and the fullest information we can collect.

Mr. Molson: Are we to understand from the Deputy Prime Minister's reply that this immensely important matter of the relief of great civilian populations is left to the military authorities? Is not this a political issue of the utmost importance?

Mr. Attlee: Statements have been made as to the arrangements made. There is a period in which this is dealt with by the military authorities, and later on it passes to the civil authorities. If the hon.

Gentleman likes to put down a Question, my right hon. Friend the Secretary of State for War will be prepared to give full details of how and why these arrangements are made.

Earl Winterton: Is the right hon. Gentleman aware that the evidence is enormous—and he knows it as well as I do—and will be grant a day for a discussion in this House, and agree to some general declaration on the situation?

Mr. A. Bevan: Is the right hon. Gentleman aware that very large quantities of foodstuffs have been stolen both in France and in Belgium, largely as a consequence of the appalling conditions of the civil population, and that the provision of adequate food supplies for the civilian population would enable cigarettes to reach our own troops in the front line; also that this conflict between the military and civil situations in France and Belgium is causing the prestige of this country to go down and is interfering with the war effort?

Mr. Petherick: Does the right hon. Gentleman realise that public opinion is really disturbed here, and that it is quite unnecessary to exaggerate, as everybody understands the difficulties—the blown-up bridges all over the Continent and all those kind of difficulties—and could he seek some opportunity of telling the House what is being done?

Mr. Attlee: I will consider an opportunity for making a full statement. It is obviously impossible to deal with every point that is made by question and answer. I have stated, and everybody must realise, the difficulties and the effect of them, but that is no reason to make what I venture to say to the Noble Lord is a too widely-extended statement.

MEMBERS OF PARLIAMENT (MISSING AIRCRAFT, ITALY)

Commander Locker-Lampson: asked the Prime Minister whether he has any news of the fate of the two hon. Members of the House who are missing; and what steps are being taken to continue the search.

Mr. Attlee: I regret to have to inform the House that at the present moment there is no further news of the two hon.


Members of this House who are missing. Search is being continued as closely as weather conditions permit and the House will be informed at the earliest opportunity of any further news.

Sir Hugh O'Neill: In view of the fact that a search has been carried on now for nearly a fortnight, and that presumably other investigations have been made, can the right hon. Gentleman not tell the House some further details in regard to the circumstances of this flight beyond what was stated by the Leader of the House a fortnight ago?

Mr. Attlee: If the right hon. Member will put down a Question, I will see what information can be given. We have not yet received a full report.

Sir R. Ross: Is the right hon. Gentleman satisfied that adequate search has been made on the East coast of the Adriatic opposite Bari?

Mr. Attlee: I have no details as to the exact search; I know a very full search is being made everywhere possible.

Sir H. O'Neill: Can the right hon. Gentleman at any rate say this: if this aeroplane has been forced down, was it probably in the mountains or in the sea?

Mr. Attlee: I have no information, but my impression was that it was in the sea. I have no further details than those I have already given to the House.

Sir H. Williams: Can my right hon. Friend say anything about the other terrible accident of which we have read this morning?

Mr. Attlee: I would rather have a Question put on the Paper about that.

Oral Answers to Questions — AGRICULTURE

Honey Production

Mr. E. P. Smith: asked the Minister of Agriculture what is the official estimate of the number of hives of bees in the United Kingdom in the years 1938 and 1944 respectively.

The Minister of Agriculture (Mr. R. S. Hudson): It is estimated that there were 450,000 colonies of bees in Great Britain and Northern Ireland in 1942. No comparable estimate is available in respect of the years 1938 or 1944.

Mr. Smith: In view of the fact that since the war Russia has increased her hives from 4,000,000 to 40,000,000, can the right hon. Gentleman say whether we have had any proportionate increase in home production?

Foot-and-Mouth Disease

Mr. Turton: asked the Minister of Agriculture what was the number of foot-and-mouth disease outbreaks from 1st February, 1944, to 1st February, 1945; how many of these outbreaks occurred in pigs; and how many occurred in livestock owned by butchers.

Mr. Hudson: There were 201 outbreaks of foot-and-mouth disease during the twelve months ended 1st February, 1945. Ninety-two of these outbreaks were due to the spread of infection from other animals in this country. In 95 of the remaining 109 outbreaks, the disease first appeared among pigs, and in 23 the animals were owned by butchers.

Farm Machinery (Depreciation)

Mr. Molson: asked the Minister of Agriculture if he is aware that British made self-binders, whose cost is 100 per cent. above the pre-war figure, are being delivered to farmers with only one coat of paint instead of three coats of paint pre-war; and whether, in view of the rapid depreciation of farm machinery due to climatic and storage conditions, he will take steps to safeguard the interests of farmers and prevent them being sold new binders which will be red rust after two seasons use.

Mr. Hudson: The British firm manufacturing binders state that, instead of the two coats of paint used pre-war, they now use a single coat of a special paint which combines the functions of priming and finishing. They have received no complaints of this method of treatment, which is a war-time measure to economise in the use of man-power and to facilitate the substantial expansion of production undertaken to meet urgent war-time needs. The prices of these British made binders have not increased more than 40 to 50 per cent. above the pre-war level.

Sir Joseph Lamb: Is it not a fact that a great deal of the trouble caused by rust on the implements is due to the fact that they have been allowed to remain in the open before being repainted?

Women (Pay)

Mr. Butcher: asked the Minister of Agriculture the date on which the present minimum rate of pay for members of the W.L.A. was fixed; the amount of such pay; and whether it is proposed to grant an increase.

Mr. Hudson: The minimum rates of pay for all women employed in agriculture including members of the Women's Land Army are fixed by the Agricultural Wages Board. Except in the case of a few counties, the present weekly minimum rate for women of 18 years and over is 48s. This rate was brought into operation on 12th December, 1943. The Board is not proposing to make any increase in the minimum rates for female workers.

Mr. Butcher: Is my right hon. Friend aware that these members of the Women's Land Army are deprived of privileges usually given to uniformed service; and will he, therefore, give them wages comparable to those usual in civilian employment?

Farmers (Dispossession)

Sir W. Smothers: asked the Minister of Agriculture how many farmers have been dispossessed since the war began; and will he give the particulars by counties.

Mr. Hudson: In order to give a proper picture of the position in the matter of dispossession of farmers under war emergency powers, the answer is necessarily long, and I will, with my hon. Friend's permission, circulate it in the OFFICIAL REPORT.

Sir W. Smithers: Whilst thanking the Minister, may I ask if he is satisfied that no undue pressure or unfair means have been used in the exercise of these powers; and will he withdraw these dangerous powers as soon as possible?

Mr. Hudson: The answer to the first part of the supplementary question is "Yes, Sir," and to the latter part "No, Sir."

Mr. Stokes: Will the Minister tell us the total number?

Mr. Hudson: Perhaps my hon. Friend would look at the statement, which is very long.

Following is the statement:

Up to 31st December, 1944, the tenancies of 2,897 holdings in England and Wales, covering an area of 248,826 acres, have been terminated by notice under Defence Regulation 62. In addition, possession has been taken under Defence Regulation 51 and retained at that date of 388,094 acres, affecting 6,739 separate cases. It has been suggested in some quarters that these figures mean that something like 10,000 farmers have been turned out of their holdings under war emergency powers. This is a complete misconception. The first figure of 2,897 includes numerous instances where the tenancy of the holding was subsidiary to some other occupation and covers such cases as off-lying fields and land occupied by persons engaged in some trade or business which prevented them from farming the land properly. The second figure of 6,739 includes a great many cases where part only of a holding was taken or where the land was not occupied by a farmer but was being used for some unimportant non-agricultural purpose or not used at all, e.g., undeveloped building sites, golf courses, parklands and extensive areas of derelict land.

While it is not possible to state the umber of such cases without a detailed examination of the records, I have obtained information as regards one county in which 1,133 of the 6,739 cases of taking possession have occurred. Of the 1,133 cases 600 comprise derelict land, building sites, marshes, etc., 60 comprise empty houses requisitioned for hostels and accommodation for agricultural workers, while in 280 cases only parts of the farms were concerned. In 940 cases out of the 1,133 cases in this county therefore no question arose as regards farmers being turned out of their farms and houses. Accordingly while it is not possible to state the exact number of cases in England and Wales which have involved the dispossession of a farmer from his farm, the number is far below the figure of 10,000 which has been incorrectly quoted.

Food Prices (Post-war Markets)

Mr. De la Bère: asked the Minister of Agriculture whether he can give an assurance that the Government have now under review the question of the margin between the food prices of this country and the food prices overseas with a view


to ensuring the retention of the home markets for the home producers in the post-war period.

Mr. Hudson: Yes, Sir. The Government have these matters under review.

Mr. De la Bète: But will my right hon. Friend, in addition to having it under review, ask the Government to raise their thoughts to the heights of the situation with which they are confronted, and thereafter take action, without which all these thoughts are in vain?

BUSINESS OF THE HOUSE

Mr. Arthur Greenwood: May I ask the Deputy Prime Minister to state the Business for next week?

Mr. Attlee: The Business for next week will be as follows:
Tuesday—Second Reading of the Requisitioned Land and War Works Bill and Committee stage of the necessary Money Resolution.
Wednesday—Second Reading of the Town and Country Planning (Scotland) Bill and Committee stage of the necessary Money Resolution; Second Reading of the Hydro-Electric Undertakings (Valuation for Rating) (Scotland) Bill: and, if there is time, Committee and remaining stages of the Nurses Bill [Lords].
Thursday—Debate on Local Government in England and Wales during the period of reconstruction, which will arise on the Motion standing on the Order Paper in the name of my right hon. and learned Friend the Minister of Health.

[That this House welcomes the intention of the Government to preserve the existing framework of the county and county borough system of local government and the proposals for the establishment of a Local Government Boundary Commission outlined in the White Paper presented to Parliament.]

Friday—Committee and remaining stages of the Colonial Development and Welfare Bill; Second Reading of the India (Estate Duty) Bill [Lords] and of the Northern Ireland (Miscellaneous Provisions) Bill and Committee stage of the necessary Money Resolution.

Further progress will be made with the Police (His Majesty's Inspectors of Con-

stabulary) Bill, and Compensation of Displaced Officers (War Service) Bill.

Mr. Kenneth Lindsay: I understand that an opportunity will be afforded for a Debate on the Burnham scales; will the right hon. Gentleman give any indication when that is likely to be?

Mr. Attlee: We are trying to arrange a convenient date, but I cannot make any statement now.

Sir Percy Harris: Would the Deputy Prime Minister give any indication when major legislative proposals are likely to be introduced, such as the National Insurance Bill? If they are not introduced soon, their chances of becoming law during this Session will be very small.

Mr. Attlee: I cannot say more than has already been announced with regard to this. We shall have to get some of these Bills through first.

Sir H. Williams: Does the right hon. Gentleman think it entirely reasonable that Members should be asked to study five new Bills in one week? Are we not going to produce a lot of very ill-digested legislation, if we have five Bills this week and six next week?

Mr. Attlee: I do not think so. I am quite sure than when the hon. Member has studied these Bills he will see that they are not very large or very controversial.

Hon. Members: Oh.

Captain Cobb: In view of the great importance of the Debate on Tuesday, it is likely that a great many Members will wish to take part. Will the Deputy Prime Minister give as an assurance that the Standing Order will be suspended indefinitely, and that feeding arrangements will be made by the Kitchen Committee?

Mr. Attlee: The Government did propose to suspend it. I cannot say that we shall suspend the Rule indefinitely, but we shall consider what can be done. I have no doubt that the question of the catering will be considered by those responsible.

Mr. A. Bevan: I note that the right hon. Gentleman has made no announcement of any opportunity next week for discussing the statement made by the


Chancellor of the Exchequer with regard to the setting up of finance corporations. As there is very grave anxiety, in South Wales in particular and, in fact, right throughout Wales and, I imagine, in Scotland, lest we should have a repetition of the creation of unnecessary distressed areas by exactly the same agency that caused them between the two wars, may I ask when shall we have an adequate opportunity of discussing the principles behind the establishment of these corporations, before they start their work?

Mr. Attlee: My hon. Friend will remember that this matter was raised and Mr. Speaker, I think, was considering a point of Order in connection with it.

Mr. Bevan: No, Sir—

Mr. Speaker: The hon. Member had better wait for my answer to-morrow.

Mr. Bevan: But may I speak on a point of procedure? There are two entirely different questions. The propriety of putting Questions on the Order Paper to the Chancellor of the Exchequer concerning the administration of these matters is a different question entirely from the policy behind the setting up of these corporations. I want a discussion, and so do most hon. Members, on the principles behind the establishment of these finance corporations.

Mr. Attlee: We shall endeavour to find an opportunity for a discussion.

Mr. Rhys Davies: In considering the Business of the House for the next few weeks, will my right hon. Friend bear in mind the growing interest of many Members of all parties in the activities of the British Council, and provide an opportunity for a Debate?

Mr. Attlee: We will consider that, and see whether an opportunity can be found.

Mr. Loftus: In view of the importance of, and the interest in, the Debate on Thursday, on Local Government in England and Wales, could we have an extension of one hour on that day?

Mr. Attlee: I will consider that.

Mr. R. C. Morrison: Could my right hon. Friend say when the Second Reading of the Water Bill is likely to be taken?

Mr. Attlee: In the near future, but I cannot give a closer date than that.

INDIA (ESTATE DUTY) BILL [Lords]

Read the First time; to be read a Second time upon Tuesday next.

Orders of the Day — EXPORT GUARANTEES [MONEY]

Resolution reported:
That for the purpose of any Act of the present Session to increase the limits imposed by the Export Guarantees Act, 1939, upon the liability which may be undertaken by guarantees given under Section one of that Act, to provide for the giving of guarantees for the purpose of encouraging the participation of the United Kingdom in external trade transactions, and for purposes connected therewith, it is expedient to authorise—

(1) Any increase in the sums payable out of moneys provided by Parliament, and charged, in default of such payment, on the Consolidated Fund, under Section six of the Export Guarantees Act, 1939, or under Section five of the Overseas Trade Guarantees Act, 1939, being an increase attributable to the provisions of the said Act of the present Session—

(a) raising to two hundred million pounds the limit imposed by Sub-section (1) of Section two of the Export Guarantees Act, 1939, upon the aggregate amount of the liability at any time of the Board of Trade in respect of guarantees given under Section one of that Act and under the Export Guarantees Act, 1937, and the enactments repealed by the last mentioned Act;
(b) raising to fifteen million pounds and five million pounds respectively the limits so imposed by paragraphs (a) and (b) of the said Sub-section (1) upon the aggregate amount of such liability in respect of the guarantees therein referred to;

(c) repealing the restriction imposed by Sub-section (2) of the said Section two upon the liability of the Board of Trade in respect of guarantees given in connection with the execution outside the United Kingdom of works and services in connection with the export of home produced goods, and the corresponding restriction imposed, in relation to guarantees under the Overseas Trade Guarantees Act, 1939, by the proviso to Sub-section (3) of Section one of that Act.

(2) The payment out of moneys provided by Parliament, and, in default of such payment, the charge on the Consolidated Fund, of any expenses incurred by the Board of Trade in connection with guarantees given under the said Act of the present Session for the purpose of encouraging the participation of the United Kingdom in external trade transactions, subject to the following limits, that is to say—

(a) that the aggregate amount of the liability at any time of the Board of Trade in respect of such guarantees shall not exceed the sum of fifteen million pounds; and
(b) that any such liability shall be included in the aggregate amount of the liability of the Board, to which the limit of two hundred million pounds herein-before referred to is applicable.

(3) The application to securities guaranteed under the said Act of the present Session of Section three of the Overseas Trade Guarantees Act, 1939 (which enables the Board to acquire securities guaranteed under the principal Act).
(4) The payment into the Exchequer of any sums received by the Board of Trade in connection with any guarantee given by the Board under the said Act of the present Session, or under the Export Guarantees Act, 1939, or the Overseas Trade Guarantees Act, 1939, as thereby amended.

Resolution agreed to.

Orders of the Day — EXPORT GUARANTEES BILL

Considered in Committee.

[Major MILNER in the Chair]

CLAUSE 1.—(Amendments as to limits on the amount of guarantees under S. 1 of 2 & 3 Geo. 6. c. 5.)

12.8 p.m.

Sir Herbert Williams: I beg to move, in page 1, line 13, leave out "two," and insert "one".
The effect of my Amendment would be to reduce the limit of £200,000,000, which is proposed, to £100,000,000 and I move it partly for the purpose of obtaining some information. This Bill is an Export Guarantees Bill; it is not an Export Credits Bill. I want to find out to what extent it will be operating in effect as an Export Credits Bill. We are


now not a creditor nation, but a debtor nation, and it is very important, at least during the two or three years after the war, that we should export only for cash. It is vital to us to obtain foreign currency, so that we can import those things which will be very necessary. Everybody talks about building lots of houses after the war, but we cannot do that unless we have a lot of timber, and the Swedes and others will not sell us timber unless we pay for it. I am, therefore, perturbed at any proposal which may have the effect of stimulating exports without at once producing cash payment for those exports.
It was all right in the days when we were a great creditor nation; we could afford to have exports which represented the export of capital, and the payment for which we only got later in the form of interest on the investments we had created overseas. My difficulty over this Amendment is that it is not easy for me to predict to what extent export guarantees will have the effect of postponing a cash payment by an overseas recipient in respect of an export of goods. If this was an Export Credits Bill I should say that we ought to reject it out of hand, because I do not think we ought to be granting export credits at this moment. Only yesterday, the House was discussing a very important Bill for the purposes of Colonial development, with which I have always been exceedingly sympathetic, but even under it, up to £17,500,000 per annum, desirable as the cause is, we are to export goods which, at the moment, will give us no overseas credit.
What is worrying me is how we are going to get industries moving when hostilities terminate. We shall need all sorts of textile materials, non-ferrous metals, timber, and there will be great pressure to increase the import of many foodstuffs of which we have been denied. All these things must wait unless our exports can be largely increased and if, as they are increased, they produce to us an immediate foreign credit which we can use to finance imports. Therefore, I am raising an important issue, but to what extent it is important I cannot visualise, because I do not know what the procedure will be under the Bill and to what extent the granting of guarantees will have the effect of delaying payment

by an overseas buyer. As I have indicated, this is not a hostile Amendment in the ordinary sense but is merely put down to draw attention to what seems to me to be an important principle.

Mr. Molson (The High Peak): I did not know what point my hon. Friend the Member for South Croydon (Sir H. Williams) intended to raise, when he moved his Amendment, but I think he has dealt with a point of some importance, and I hope the President of the Board of Trade will welcome the opportunity of giving an answer to it. There is, I feel, general agreement in the Committee as to the need for a great increase in our exports, primarily in order to pay for our immediate need of large importations of raw materials and foodstuffs at the end of the war. In addition, and secondarily, we are all looking forward to a great export of capital goods for the benefit of our Dominions and, I hope, for the benefit of Russia and other countries whose economic development will, in the long run, be of immense value to this country. But there is a danger of what I might call a hiatus, if we are trying to concentrate upon those exports of capital goods which will not bring us in an immediate return. There might well be a danger that we should be engaged upon exports which would bring us in a longterm return, but leave us short for that difficult intermediate period, when there will be a shortage of raw materials throughout the world and when overseas countries are likely to ask—not in an unreasonable spirit, but because of pressure upon them—that they shall receive immediate payment in the appropriate currencies.
I am glad my hon. Friend has raised this point in no hostile way, and I am sure it would be most valuable to the Committee and those who are studying this matter in the country if they could have some indication as to how far the Board of Trade feel they will be able to go in maintaining the balance between those equally important forms of export, capital goods bringing us a long-term return and consumption goods bringing us an immediate return, the appropriate priority must be given to one over the other in our export policy at the end of the war.

Mr. Ellis Smith: I oppose this Amendment because, in my view, it is an


indication of a fundamentally wrong approach to our post-war problems. Our people have to make up their minds that after the war we shall be living in a new world. The war has proved the enormous productive capacity of British industry. The needs of the world will be so great that an industrial country such as ours will have to re-adjust itself to the new situation. Enormous resources in all parts of the world will be at our disposal, and if this country links its productive capacity to those resources then we should not be concerned, as the hon. Member for South Croydon (Sir H. Williams) evidently is, about the postponement of cash payments. In an Amendment which I have put down, I seek to apply this policy to the Commonwealth. There will be enormous resources of timber, food of all kinds, fruits and the like, and if the Government formulate a new, concerted economic policy for this new situation, there will be no need for concern about the out-of-date ideas that lie behind the hon Member's Amendment.

12.15 p.m.

Mr. Harcourt Johnstone (Secretary, Overseas Trade Department): The Amendment moved by my hon. Friend the Member for South Croydon (Sir H. Williams) was, as he said, intended rather to cover an inquiry than to be pressed to a Division. I should like to start by assuring him that the question of long credits which he raised is very much in the mind of His Majesty's Government. The difficulties which he enumerated are practical; they exist and must be faced, but as regards the machinery of the Export Credits Guarantee Department, as I think I said last week, the normal ratio between short-term and long-term credits has in the past been something in the nature of 8 to 1. I know, no more than the hon. Member does, whether that ratio will alter conspicuously after the war, but up to the war the number of what may be called cash transactions, that is, credits up to 12 months, was as about 8 to 1. Therefore, unless there is a very conspicuous change in the ratio between the two, there should not be any real danger of our giving too much credit.
As to the length of credits as opposed to the amount, that must, in every case, be a matter of negotiation. The longterm credits granted by the Export Credits Guarantee Department are

generally for very large sums, which may go as high as £10,000,000 or £15,000,000, and in every case they are the subject of special inquiry and of special negotiation. The same terms cannot apply to each transaction; there is no fixed term which one can apply over the whole field. The terms must vary in every case. I can assure my hon. Friend that there will be no inclination on the part of the Government after the war unduly to lengthen the terms of credit. On the contrary, our inclination will be to secure as much cash and as rapidly as possible. Naturally we shall have to take account of the terms that our competitors may offer.
It may unfortunately be necessary on occasions to refuse business, because we cannot or do not deem it wise to offer the same length of credit as our competitors may offer. On other occasions the balance of advantage may lie in offering credits quite as long as or in some cases longer than those offered by competitors. But, by and large, I can assure the hon. Member that the policy of the Government will, as I said, be to get in as much cash as possible and as quickly as possible, and not to fish unnecessarily, as it were, for business by dangling very long credit terms before our customers.

Mr. Edgar Granville: I hope that the Government will not accept this Amendment, and I am sorry that the Secretary of the Overseas Trade Department appeared to go out of his way to try to placate my hon. Friend the Member for South Croydon (Sir H. Williams) on this question. I hope that his reply does not mean that the policy of exports for this country is to be something in the nature of a cash register. I do not think that we shall be able to organise or to increase our export trade by keeping our eyes solely on an immediate return. I do not know whether the new Clause which seeks to amend the principal Act and which has been put on the Paper by the hon. Member for Stoke (Mr. Ellis Smith) will be ruled out of Order, but that would of course raise the specific question of a fund to be earmarked for developing export trade within the Commonwealth. I was hoping that the Overseas Trade Department would give us some indication of a plan, some sort of long-term plan, which they hoped to promote in association with the democratic Dominion Governments of the British Common-


wealth. As my hon. Friend the Member for South Croydon said, we yesterday adopted something of this kind in relation to the development of the Colonies, and an attempt is being made to increase the trade between the Colonies and this country. I at least hoped that the right hon. Gentleman would tell us that he had some sort of general scheme to deal with this problem, and that he had discussed it with the trade Ministers of the Dominion Governments and particularly with those representatives of Dominion industry who have been visiting the factories of this country during recent months.
Let me give the Committee an illustration. If we are to export motor cars, aircraft, refrigerators or other things after the war it is not sufficient to give credit or export facilities to the manufacturers in order that they make first sales abroad. That will not even get this country back to the position in the export market which it had before the war. If I may have the attention of the Secretary of the Overseas Trade Department I would suggest that one of the things we ought to concentrate on is a long-term policy in the Dominion markets by building up and maintaining the service and practice of British industry in those markets.

The President of the Board of Trade (Mr. Dalton): That has nothing to do with this Amendment.

Mr. Granville: It has a great deal to do with it, because it asks that we shall provide only £100,000,000 instead of £200,000,000, and I am arguing against that Amendment and am proposing a policy which is consistent with what business men here and in the Dominions want to see undertaken by the right hon. Gentleman's Department. We shall have no chance of competing with the United States of America in the export of motor cars, aircraft and other machinery unless we are prepared to establish in the Dominions proper, efficient and effective servicing facilities and the supply of technical information. We shall not be able to export aircraft unless the right hon. Gentleman's Department is prepared to use a large portion of this money to encourage modern export methods in the supply of spare parts and so on, and also some sort of organisation which will

enable those who are selling these capital or consumption goods in the Dominions to deal with the troubles of all sorts which follow after primary sales. If the right hon. Gentleman thinks he can send Lord Nuffield or industrialists of that standing out to the Dominions to say, "Here we are, producing good motor cars for your requirements" and leaving it at that and in that way we shall compete effectively with highly organised and specialised export business of America, we shall see very little result from the £200,000,000 provided by the Bill. I heard recently of a case where this country was producing certain aircraft in the Dominions and was experiencing difficulties, and instead of sending back to the designers and makers of the aircraft to find out where the faults lay and get the necessary technical assistance they sent to one of the business concerns in the United States of America, because there the problem of the export trade has been tackled on a scientific and specialised basis.
If the Department of Overseas Trade is to justify its existence and the time it has been spending on this problem it will have to tackle the question of exports from a comprehensive point of view, with a long-term policy, and will have to guarantee more than the £200,000,000 which the Bill provides. I should be out of Order if I were to raise the question of the decentralisation of industry or bulk purchases in this Debate, but surely I am in Order in asking the right hon. Gentleman if he contemplates that the £200,000,000 will cover in any way bulk purchases priority through trade agreements. As the right hon. Gentleman knows, an Indian Purchasing Commission is visiting us in this country at the present time. What is to be the attitude of the Government towards it? Is there to be any direction—

The Chairman: I have directed a very kindly eye upon the hon. Member so far, but he certainly cannot raise the question of the Indian Purchasing Commission here. The only question before us is of the amount to me made available.

Mr. Granville: With great respect to your Ruling, Major Milner, that Commission is here to purchase certain British commodities which will be exported from this country under the provisions of this Bill. [HON. MEMBERS: "No."] May I


put it another way? Anyone selling commodities to the Indian Purchasing Commission will be entitled to avail himself of the provisions of this Bill, and I want to know whether the right hon. Gentleman has that in mind. I certainly hope that the Overseas Trade Department, in considering any long-term planning, will not listen to the blandishments of the hon. Member for South Croydon but will tell us that not only have they this Bill but that they have a long-term plan which will put export trade throughout the British Commonwealth upon the map after the war.

Mr. Pritt: I am a little disquieted by the answer of the Secretary of the Overseas Trade Department. I understand the purpose for which this Amendment has been moved, The hon. Member for South Croydon (Sir H. Williams) says: "Do not export much unless you get actual cash." The only way of working an Export Guarantees Bill, which involves, of course, certain limited credits, is, for preference, not to use it at all, but if it must be used to use it as much as possible for short-term credits. The hon. Member said that he was not hostile to the purpose of the Bill. The real answer to that is an answer in somewhat elementary economics. What does the Minister do? I do not know whether it is a hang-over from the old habit of appeasement, for which, if I remember rightly, he was not particularly responsible in the wider field, but his answer is "It is only a little one. We will not do very much. We cannot prognosticate exactly what will happen under the Bill, but we hope that they will rather be short-term credits; that the hon. Member for South Croydon will not suffer undue anxiety or be kept waiting very long, and that the Bill won't be very much used for the wider purposes discussed by His Majesty's Government on Second Reading." On that occasion Members on all sides of the House pointed out the inestimable political value and also the great economic advantage of both short-term and long-term credits, and of letting the Bill build up a bigger long-term credit trade not only in consumer goods but in producer goods with the U.S.S.R. and a good many other countries. If, the moment the hon. Member for South Croydon says, "I do not like that; it is going to keep us out of cash," and instead of giving a real answer just says,

"It will only be a little one," it is not very satisfactory.

12.30 p.m.

Sir Granville Gibson: The hon. Member for Eye (Mr. Granville) wanted a long-term policy. If this Bill is anything at all, it is a longterm policy, and that is why I support it. I was very intrigued by the Amendment because generally on matters of economic policy my hon. Friend and I walk along the same road. I was somewhat relieved when the Secretary for Overseas Trade said that short-term business compared with long-term business was in the ratio of eight to one. That was very comforting because it indicates that the risk of losses need not be very great.
When one casts one's eyes over various parts of Europe, one must face the fact that in the post-war years there will be an enormous demand for capital goods, generally speaking of very large amounts. I notice that with regard to Leeds new capital machinery was wanted for the extension of the power station and it amounted to over £1,000,000. Some European countries have been devastated, and others may be before the Germans leave them. It is quite conceivable that some of the wonderful power stations in Norway and Denmark will be destroyed and it is very desirable that we should be in a position to finance firms in the exportation of capital goods and assist them in getting orders. I am informed that the devastation in Russia is almost incomprehensible, it is so enormous. Russia is now the third, if not the second, largest gold-producing country in the world. Before the war she was taking £50,000,000 a year out of the soil but that is nothing compared with what she will have to spend, and she will not be in a position to pay cash for the capital goods that she will desire to put down. It is inconceivable that we should take up the attitude that we are not going to explore every possible avenue to enable our manufacturers of capital goods to be in a position to finance their exports, or at any rate to put them in such a position that they feel that, having undertaken such large financial commitments, if there is a danger of a bad debt they stand a chance of recovering part of the loss that may be entailed.
I can therefore see my hon. Friend's point of view in putting down the Amendment


with no hostile intent, but simply for information. I was delighted when the Minister gave the assurance last week that, if £200,000,000 was not sufficient, he would be prepared to ask Parliament for more. I wish the Measure every success. I believe it can play a very important part in winning for this country a large amount of export of capital goods and, if we did not have a Measure of this kind giving tremendous financial assistance by insurance against possible losses, it would militate enormously against the provision of capital goods which will be wanted in the devastated countries of Europe, and probably in many parts of the world. I shall oppose the Amendment.

Mr. Benson: This matter was discussed rather cursorily on the Second Reading. The President of the Board of Trade mentioned that we should be very largely concerned in cash transactions and he was not particularly anxious to see long-term credits expand beyond a certain point. I agreed with him then but in the meantime I have rather changed my point of view. I think he had in mind the exchange position. I am not sure that this is really fundamentally an exchange problem. Probably it is more a problem of actual physical goods. It is obvious that we shall have a very great difficulty in balancing our trade after the war, partly because we shall have enormously to increase our exports but also because many of our markets will have suffered such devastation that they are not able to produce the goods to send to us. Thus, if we are to re-establish our markets, they will have to be fed with capital goods on credit from some source or another and it will pay us to make considerable efforts to re-establish those markets in the first two or three years in order that they may be able to buy from us for cash at a later period.
But there are one or two other points that arise. Let us admit right off that the crying need of this country after the war will be to export goods for cash, in other words, to export in order that we can immediately get consumable imports. Another question arises. How far are the firms which make capital goods able to switch from capital goods to cash goods without any great difficulty? Take, for

instance, a firm like Beyer, Peacock, who make steam-engines. They may not be able to switch their capacity immediately to cash goods, and to limit their exports would not help us in any way to balance our trade. There is another thing. Our foreign markets are not the only places which will be starved of capital goods. There is this country. We have to do an enormous amount of re-equipment and the problem that we are really faced with is a threefold one: first of all, which shall have priority for capital goods, the foreign markets or this market; secondly, would it be possible to increase our exports of cash goods as a result of curtailing our export of capital goods; and, thirdly, how are we going to finance the export of capital goods with long-term credits? As regards the last point, I think we shall succeed. It is true that we are likely to be a debtor instead of a creditor nation on current account, but our position is nothing like as parlous as is sometimes made out.

Sir H. Williams: Is the hon. Member overlooking the £3,000,000,000 of sterling credits in London which enable people to buy vast quantities of goods from us without our getting any imports at all?

Mr. Benson: I am not overlooking that fact. I am coming to it, but for the moment I am stressing the point that the credit of this country will be good after the war and it does not matter very seriously if for three, four or five years we have a considerable adverse balance of trade. I doubt very much whether we shall escape having that under any circumstances. We are not going to export hundreds of millions of pounds' worth of capital goods. We shall not have the capacity to do it. It is the export of capital goods that requires long-term credit. [Interruption.] You do not export cotton goods on a five years' credit. Things that are to be exported on long-term credit are capital goods only and we are not going to export capital goods in such an enormous proportion as is likely completely to wreck our exchange position. I think we shall be able to risk an adverse balance, for the export of capital goods is not going to increase that adverse balance to unmanageable proportions. Therefore, the real question is how much of actual physical capital goods we can afford to export in view of our own home needs.
The hon. Member for South Croydon referred to the £3,000,000,000 sterling balances. No one knows better than the owners of those sterling balances that, if they try to spend them immediately, they will fail. They have been built up as a voluntary effort on the part of their owners in the general war effort.

The Chairman: We are getting rather far distant from the Amendment. The only question is whether the amount available by way of guarantee shall be £100,000,000 or £200,000,000.

Mr. Benson: I submit that this has a definite bearing on the question. Anything that tends to facilitate long-term exports affects the matters that I have been talking about and, if we cut down our maximum from £200,000,000 to £100,000,000, it would definitely curtail it. I am suggesting that we do not need to cut it down because I do not think the export of capital goods is likely to involve this country in serious exchange transactions. But if, Major Milner, you rule sterling balances out of Order, I must accept your Ruling.

12.45 p.m.

Mr. Hammersley: I am not going to try to deal with the rather long disquisition which has just been made, with which, on the whole, I do not seriously disagree. The purpose of this Amendment was to obtain information, which was forthcoming. It was to the effect that the proportion of long-term credits to short-term credits was one to eight. The mover of the Amendment pointed out that since the war our financial circumstances have changed for the worse, and he indicated that if it was right that we should export on long-term one-eighth of what we exported on short-term through these credits before the war, it was not right that we should increase that proportion to our disadvantage. I think that in that argument he was perfectly sound. It cannot be right that we should use the limited resources of this country to export goods which we can only make, perhaps, inefficiently, and can only sell by long-term credits, as against exporting goods which we can make efficiently, and which do not require such long-term credits. Although it may be possible in the long run to do both, we should not adversely affect the ratio between the two. The Government have said that it is not

their intention to do so, and, for my part, I am perfectly satisfied.

Mr. Stokes: I certainly oppose the Amendment. I thought that this Bill was a miserably small Bill when it was introduced. Although I expect that the Amendment was put down to elicit information, it would, in point of fact, make what is a miserably small Bill an absolutely diminutive Bill, and the effective increase over pre-war credits would not be more than £12,500,000.

Mr. Dalton: It would be a minus amount.

Mr. Stokes: There is one point on which I probably agree with my hon. Friend the Member for South Croydon (Sir H. Williams). There are people overseas who have enormous sterling balances. I have found in my wanderings that these people think, for some extraordinary reason, that they are going to get long-term credits and guarantees. It ought to be made abundantly clear to them that they are not, and it would have a healthy effect on their attitude to travellers and business men who go abroad if they understood clearly that countries with large sterling credits are not going to be allowed to engage in trade with business firms in this country and avail themselves of the facilities afforded by this Bill.

Sir Patrick Hannon: I want to support my hon. Friend the Member for East Willesden (Mr. Hammersley), because he focused the result of this long discussion in the answer of the Secretary to the Overseas Trade Department. My hon. Friend the Member for South Croydon (Sir H. Williams) was right in bringing this Amendment forward in the friendly way he submitted it to the Committee. He wanted a statement from the Board of Trade as to the extent to which facilities to purchase raw materials required for production could be made available. That reply was given, and, as my hon. Friend has said, it has proved to be satisfactory.

Dr. Russell Thomas: We owe a debt of gratitude to the hon. Member for South Croydon (Sir H. Williams) for bringing this matter up. There is no doubt that we can export to all parts of the world without getting any return at all. My hon. Friend the Member


for Pudsey and Otley (Sir G. Gibson) mentioned Denmark and other countries of Europe. We can send them capital goods, but we shall not get anything in return for a long period. Denmark used to supply butter, eggs and that sort of thing, but their cattle, and hence their production, has been destroyed by the German invaders. Therefore, we can hope for no return from such a country. There are many other European countries which were in the past a market for our goods, which can give us nothing in return for a long time.

Sir G. Gibson: The reason I mentioned those countries in regard to long-period commitments, was because they cannot export to us and have not the money to pay for our goods. I would not grant credits to those countries which already have large credits here.

Dr. Thomas: We cannot expect much from these countries for a long period of time. In regard to the other point brought out by the hon. Member for South Croydon, we have to be careful in regard to exporting to Australia, New Zealand, India, Egypt, Argentine and so on, to whom we owe £3,000,000,000. We could export under that debt arrangement an enormous quantity of goods but again we would not get much in return. I do not suggest that we should not export at all to these countries, but we must bear in mind that we might well get nothing in return.

Viscount Hinchingbrooke: I presume the hon. Gentleman means that we should not get interest on our investments. That is true, but what we should get is the foreign exchange which is necessary.

Dr. Thomas: The hon. Member is under a misapprehension, and I do not think I need follow up that point—the Committee has signified its opinion of the hon. Member's mistaken interjection. We could send our goods to recondition the Far East when it is recovered from the Japanese, but there again we would have no immediate return. Another point is that the money which will be spent through the Colonial development loans, which we discussed yesterday, will bring no immediate return to us. Much will be spent on education and so on. There is no doubt that our people have

suffered acutely during the war. The Minister of Production has said that our import trade has dropped by 60 per cent. during the war, and we have had to do without an enormous number of things. The demand which will be made on the population of this country for houses, export trade, reconditioning of industry, railways, water Bills, and all sorts of things will require, not 20,000,000 workers, but 40,000,000. We shall require an army of workers far above anything we have in this country to achieve these things in a few years. We cannot therefore ask our people to go on tightening their belts indefinitely, but that is what will happen if we are not careful in regard to this matter. We must see that as far as possible our immediate postwar export trade results in material benefit to our people who have been without so much for so long.

Mr. Petherick: I said nearly everything I wanted to say in the Second Reading Debate, and I am still not happy about the general export credits scheme as a whole. Therefore, I think my hon. Friend the Member for South Croydon (Sir H. Williams) has done a service in raising this matter again. I should like some representative of the Treasury to intervene to tell us how the general system of export credits under the exports credits guarantee scheme is to be related to our post-war trade and finance, in view of the fact that there are so many imponderables. We do not know in what direction trade is going and who is going to be in a position to buy British goods after the war, and it is important that we should have the Treasury view. We cannot expect to have it to-day, but I hope that, when the Budget comes forward for discussion, we may have some further information as to the way in which the general export credits system will tie up with foreign trade and finance in general. I do not think the noble lord the Member for South Dorset (Viscount Hinchingbrooke) was correct in his intervention. We are not getting any foreign exchange as the result of these export credits schemes.

Viscount Hinchingbrooke: It we export capital goods to a country, we shall get foreign exchange in return. There is no difference between capital goods and consumption goods, so far as receiving foreign exchange is concerned.

Mr. Petherick: We are not getting foreign exchange because we are not being paid in that form. What we are doing is to place sterling at the disposal of foreigners, which is quite a different matter. The point I am putting is, whether we are right, in relation to our post-war trade, our enormous commitments and the necessity for conserving our credit in every form, in continuing this general system of export credits. I therefore hope that His Majesty's Government will, between now and the discussion on the Budget, look into the whole matter of the scheme of export guarantees in regard to the financial and trade structure which it is envisaged will hold good after the war.

The President of the Board of Trade (Mr. Dalton): I understand that my hon. Friend the Member for South Croydon (Sir H. Williams) has moved this Amendment, not with a view to pressing it to a Division, but to elicit information and to stimulate Debate. He has done that. My hon. Friend the Member for Ipswich (Mr. Stokes) is not as strong at arithmetic as on some other subjects, and if he will excuse my saying so, he got it wrong again to-day. If the Amendment were carried, it would not be the case that the increase in export credits would be small; it would be a minus quantity, because export prices have doubled since the outbreak of war. Consequently, if you reduce the limit from £200,000,000 to £100,000,000, and the equivalent of the pre-war limit of £75,000,000 is now £150,000,000, because prices have doubled, the effect of the Amendment will be, not to increase the credits by a smaller quantity, but definitely to diminish the availability of export credits. I am sure that that is not what he intends.
What we have to do is to steer a course between too much and too little On the issue between my hon. Friend the Member for Penryn and Falmouth (Mr. Petherick) and my Noble Friend the Member for South Dorset (Viscount Hinchingbrooke), I am sure that my hon. Friend the Member for Penryn is right and that the Noble Viscount is wrong. If I advance to the Noble Viscount a sum of money on credit, I do not get paid until he repays me. In the same way we do not get foreign exchange, unfortunately, from any of the credit operations during the currency of the credit. On the other hand,

when we export for cash we get foreign exchange at once, and, equally, when we export on credit terms we get foreign exchange when finally the credit is repaid, but we do not get it during the period when the credit is running. That is a point which was in the mind of my hon. Friend when he moved the Amendment and which has been in the minds of other hon. Members who have taken part in the Debate. When I was moving the Second Reading of the Bill, I sounded a note of warning in that regard when I said:
The purpose of exports is not fun, it is not to send away goods merely for the sake of sending them away—goods on which British labour has toiled and sweated—in order that other people may enjoy them. … There is only one justification for exports and that is that it is more useful to send away the things we have made in exchange for other things we need rather than to keep them here."—[OFFICIAL REPORT, 31st January, 1945; Vol. 407, c. 1487.]
I went on to develop that argument and to show that in the post-war period we must have substantial imports in greater volume in some respects than before the war, if we are to achieve our full employment policy, because raw materials and food, which cannot be produced in sufficient quantities here, must be imported from abroad. If these things are to come in, we are not going to get them on credit from the producers and growers. This is not a two-way credit with which we are dealing. Our good friends in the Dominions—and I am as keen on Dominion trade being developed as anybody—are not proposing to let us have all sorts of things on credit, even when they come under the aegis of bulk purchase. We have to pay for the raw materials and food in some way or another. The way we pay for them is by our exports. The moral to be drawn is that there must be some limit and some prudence in regard to these operations of export credit guarantees, and that prudence will be forthcoming. We have an arrangement whereby all these proposals are scrutinised by the Advisory Council, and that arrangement will continue. We must be prudent in this matter.
1.0 p.m.
On the other hand, those who have opposed the Amendment have dwelt upon the importance of export credits to certain branches of our industry immediately after the war and upon the great importance of a number of markets, from


which we cannot hope to get very quick returns. That also is right and proper. We must keep a balance between the two sides of the argument. If I might again revert to the Second Reading, I did myself say that the limit now proposed is one which, when all adjustments had been made for price variations, meant an increase of some 33 1–3 per cent. on the volume of goods which may be covered. I think that is reasonable. I went on to add that there was still a bit in the "kitty," nearly £40,000,000 within the present limit of £75,000,000. There is a little slack that we can take up there. I also said that if it should appear, in course of time, that we got close up under our ceiling, it would be easy to come back to this House, and, by a one-Clause Bill, seek agreement for the raising of the ceiling. That we will do, if we feel it is necessary and if the circumstances justify such a course. My own guess would be that this would not be necessary for some time to come. I shall be surprised if we get into that position very soon. We will watch the position, and will consult the House accordingly.
As to who should benefit from these export credit arrangements I will not lay down any hard and fast rule. They are available generally for British exporters and any British exporter is entitled to seek this form of assistance in regard to any projected transactions. Many may seek it, but be rejected on consideration. As was explained during the Second Reading Debate we are going to make the arrangements rather more flexible in future and we shall not require an exporter to bring in all his business when he seeks guarantees in respect of some part of it where particular risks have to be undertaken.

Dr. Russell Thomas: Would the Minister expect a private manufacturer to use the whole of his own financial credit before seeking or being granted credit under the scheme, as has been the policy in the past?

Mr. Dalton: No. I can assure my hon. Friend that that has never been the practice of my Department, and that it certainly will not be the practice in the future. An assurance can be given on that point.
Reference has been made to the countries which are fortunate enough to hold

large sterling balances. It would be out of Order for me to do what I should like to do and say something about that subject. You would very properly draw my attention to it, Major Milner, if I did so. There is a lot to be said about the holders of sterling balances, but this is not quite the time to say it, or to say how some of those sterling balances have come into existence. A person who desires to export to people who are fortunate enough to hold sterling balances has not, at first sight, a particularly eligible claim for this form of assistance, which ought not to be required.
Having said that, I repeat that there is no hard and fast rule whether or not those applications should be refused. They will have to go through the ordinary machinery and each case will have to be looked at on its merits. In reply to the hon. Member for the Eye Division (Mr. Granville), I think it is true that trade with the Dominions does not in general carry risks either way. We trust each other. That has been proved through the years to be a sound expectation. Therefore, although Dominion trade certainly stands second to none in importance in my view, and in the view of the Government, yet we do not think there will be very much need for anybody trading with the Dominions, by and large, to apply for this assistance. They will be entitled to ask for it, but we must remember the traditions which have grown up between ourselves and the Dominions in this matter.
With regard to the long-term plan, what we seek to achieve is a continuous process of planning in regard to these matters. This is an observation of rather wider import than in relation to this Bill. People talk sometimes as though you could have a long-term plan and do nothing more than carry out the plan which you have made. The Russians have taught us, in fact, that planning is a continuous process of adjustment. We have all done it during the war and that is what we must do with regard to these trade matters. Here I would like to say a word for the benefit of my hon. Friend the Member for Chesterfield (Mr. Benson), who asked about priorities and how they were going to be determined in regard, for example, to the needs of industry here in this country. I have several examples in mind of the kind of thing which he is thinking of.
As to how we are to allocate priorities between the home market and the requirements abroad for capital goods, between the export of capital goods and the production of such goods which are urgently required to make good depreciation in our capital equipment here—in some cases where the goods are produced perhaps by the same firm in another branch of their business—I say quite frankly that each case has to be considered on its merits, and in the light of the circumstances of the time. The Committee are quite entitled to ask the Government, and the Government are quite prepared to give the Committee an assurance, because the Government are most anxious and willing in this matter, that we are constantly in touch with various industries and representatives of various industries with a view to making this continuous adjustment of priorities. Only last week I had a very interesting talk with the representatives of one of our most progressive branches of industry, which is very much concerned with the export of capital goods. We were discussing this very topic. I cannot give the details to the House, because it was a private talk, but it illustrates the way in which we are continuously engaged in the adjustment of the various claims upon our total industrial capacity. Those claims are very much in excess of our capacity, expanded though that has been during the war, and of what we hope to achieve in the near future. The priority problem is a real one.
If my hon. Friend were proposing to press the Amendment to a Division, and I do not think he is, I should have to ask the Committee to reject it. I hope the Committee will accept my assurance that we shall keep a very constant watch upon these problems, and that we are not going to give credits needlessly. Certainly not. We shall give guarantees where we think it is necessary to do so in the interests of British trade. We are working within the present ceiling, and we shall take a little while to get up to the new ceiling. As we approach it, we shall not hesitate to come back to the House and ask for the ceiling to be lifted.

Sir H. Williams: I am very glad that I put down the Amendment. It has produced a very interesting Debate. I find myself quite satisfied with the attitude of the Minister but I am a little disturbed to

find there are still people left in this House who do not realise that the facts are quite different now from what they were in 1939. The shift from a creditor position to a debtor position means that new policies are needed, and it means that we must be ahead of the times and not behind the times. I have heard three interjections which indicated that those who made them did not realise the change which has come about.

Viscount Hinchingbrooke: That is our general complaint against the hon. Member.

Sir H. Williams: Apparently the Noble Viscount does not realise that the use of sterling balances to pay for exports from this country does not produce foreign exchange for use by this country. His ignorance was so monstrous on the point that I am surprised that he should want to intervene any more. Our fundamental need is to pay for our imports, and how we are to pay for them without exports I do not know. I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Motion made, and Question proposed, "That the Clause stand part of the Bill."

Mr. Ellis Smith: In reply to a number of questions the Minister, during the Second Reading Debate, said, if I understood him correctly, that the Department were disappointed with the relatively small number of applications which they had had. We ought to put similar questions to the Minister at this stage, to obtain a clear statement of what the Government's policy will be when they come to administer this Measure, and how they propose to stimulate greater interest among business concerns to take advantage of these facilities. When the Bill becomes law, it will provide for an increase from £75,000,000 to £200,000,000, representing an addition of £50,000,000 on present export credits. The liabilities at present on the fund are £40,500,000. If those figures are correct, I calculate that we shall have a surplus of £84,250,000. The question arises how this sum is to be used and where we can utilise it to the maximum extent, in order to ensure against all risks which business concerns will have to take in the post-war situation. It is on these points that I want to make a few observations.
In the speech which he has just made the Minister said that risks within the


British Commonwealth were relatively small. I readily agree with that, but the difficulties are also great in some cases. In my view it is the duty of this country to adopt a policy of assisting the Dominions more than we have done in the past. After the war, one of the most serious matters will be the use of accumulated surpluses, which are bound to arise from the agrarian countries.

The Chairman: I do not think we can have a Second Reading Debate at this stage of the Bill. The Clause with which we are dealing only entitles us to discuss the merits of the proposed increased guarantees. The hon. Member may have a chance to raise the question in which he is interested on Clause 3. We have had a very long Debate on the Amendment and I hope we shall not have a long repetitive Debate on this question.

1.15 p.m.

Mr. Ellis Smith: I hope you will give consideration, Major Milner, to what I am going to say. This Clause provides for guarantees to be given
… for other purposes conducive to the establishing or encouraging of trade …
That is in paragraph (c), and upon that, I was proceeding to make two points. My first would be that this country now has enormous resources at the disposal of civil engineering, and I understand that this Bill provides for credits to be given to cover contracts for large scale civil engineering which are bound to be required in all parts of the world. It is most important that our surplus capacity in civil engineering should be utilised to the maximum extent if we are to pursue a policy of full employment. It is most important that this country should get a clear understanding of what will be at the disposal of industry immediately on the termination of hostilities. It is for that reason I would like further information to be given to-day in regard to the enormous, accumulated stocks that will be available.

The Chairman: I must restrict the hon. Gentleman to the question arising on the Clause. The increase of the limit under Clause 1 (1, c), to which the hon. Gentleman is directing himself, increases the limit in respect of guarantees under Subsection (4) of Section 1 of the principal Act, from £2,500,000 to £5,000,000. I

do not see how the question he is now raising comes under that heading.

Mr. Smith: Under the arrangements that will be made, after the war, the question will arise, how and for what purpose that increase is to be used. It is upon that I am hoping to stimulate interest, and also to get a reply from the Minister that will enable us clearly to understand what is in the mind of the Department of Overseas Trade with regard to the increased facilities that have been provided by this Bill.

The Chairman: If the hon. Member will relate his remarks to the increased guarantee, he will be in Order but, at the moment, I do not see how he is going to do that.

Mr. Smith: I do not propose to pursue the point. You have been good enough to assure me, Major Milner, that on Clause 3 there will be an opportunity of developing further the point I am making. Having made these points, may I add that I hope the Secretary of the Department will reply to a number of questions that should have been replied to on Second Reading?

Mr. Dalton: I was thinking of saying a word in reply to my hon. Friend, but I cannot remember what questions raised on Second Reading were not replied to. If my hon. Friend, keeping within the Rules of Order, can remind me of any, I will do my best to deal with them.

Mr. Granville: All of us in the Committee are greatly indebted to the right hon. Gentleman the President of the Board of Trade, for making clear a number of points on which there was a certain amount of ambiguity on the occasion of the Second Reading of the Bill. We are grateful to him for making these points clear not only to the Committee but to industrialists and traders outside, who may or may not have the opportunity, through their trade associations, of having contact with his Department or the Department of Overseas Trade. I find that there are a number of manufacturers, some in my own constituency, who think that at the end of the war all they have to do is to pack their bag, put in their samples, and go abroad and compete with various countries in trying to get orders. The right hon. Gentleman made the position quite clear to-day,


when he dealt with the difference between capital goods and consumption goods and the question of priorities.
The question of priorities is, in itself, a tremendous subject, and would require for its full consideration a degree of expansion in the scope of the Debate which would be out of Order. I hope that the right hon. Gentleman will, on some occasion, deal more specifically with this question because, as he knows, there will have to be direction and assistance—not so much control—given from his Department to the traders of this country, as to what they are to produce, when and where they are to export their products, and this Bill, of course, provides the necessary guarantees. This will be so because of the various Trade Agreements after the war. Those who think we live in a world of laissez faire, and that all we have to do is to produce samples and price lists and go into the world looking for orders, have a rude awakening coming. I would like to stimulate the President of the Board of Trade to state at some time the details of the Government's overseas trade plan in a world disrupted by war conditions.

Mr. Dalton: My hon. Friend the Member for Stoke (Mr. Smith) raised the question of civil engineering. It is true that engineering has been expanded for war purposes more than any other branch of our industry. One of the problems of the switch-over will be how to ensure that we shall retain the advantages of all the improvements that have taken place in engineering technique, equipment, factories, etc., and not find a surplus of labour in the engineering industry which cannot find full employment—a state of affairs which would constitute a violation of Government pledges. As an aid to that readjustment these export credit guarantees will certainly be of considerable assistance. I would say that among the branches of industry that will certainly come along and make good their claim to participate in these export credits, civil engineering will hold an important and prominent place. These guarantees will, I hope, aid the maintenance of full employment in civil engineering after the war, and so enable us, perhaps, to develop new forms of exports with which we did not previously deal to any great extent. I recognise civil engineering as being a very likely

and strong claimant for aid under this scheme.
The hon. Member for Eye (Mr. Granville) raised the question of priorities. It would be out of Order to go into that now, beyond repeating what I said just now. We are anxious to keep in close touch with the various industries on these questions as they arise from time to time. As to whether it is part of our duty under this Bill to tell industry quite all the things that my hon. Friend suggested—to tell them, as he said, what to make and where to sell it—I beg leave to doubt whether, in spite of my own political proclivities, I shall be called upon to give quite that degree of authoritative guidance to all branches of industry. I rather hope and believe not.

Question put, and agreed to.

Clause ordered to stand part of the Bill.

CLAUSE 2.—(Power to give guarantees in connection with external transactions.)

Motion made, and Question proposed, "That the Clause stand part of the Bill."

Commander Prior: There are two questions I would like to put to the President of the Board of Trade. Will a United Kingdom merchant be in order in asking for guarantees in respect of exports of Dutch produce between, say, Surabaya and New York? Secondly, will a United Kingdom merchant be in order for asking for guarantees to export commodities of foreign origin lying in the entrepôt Port of London to, say, Sweden.

Mr. H. Johnstone: The answer to both those questions is in the affirmative. That is the intention of the Clause.

Mr. Ellis Smith: I desire to ask a few questions with a view to eliciting information. First, under that provision of Clause 2, by which the Export Guarantees Advisory Council is to be brought into consultation with the Minister, can we have an assurance that in the future their decisions will be carried out with greater speed than in the past? Secondly, are they alive to the seriousness of the question of delivery dates? In some cases, when concerns have been quoting for contracts, there has been so much uncertainty they have not been able to give delivery dates, which in some cases be-


tween the two wars made all the difference as regards obtaining or not obtaining large orders. I find that some industrial concerns in this country consider that the premiums charged are too high. I would like some information on that in relation to what is to be the policy in the future. My final point is that between the two wars the facilities contained in this Bill provided for orders to be obtained from Russia to a greater extent than they would otherwise have been, and some of the industrial areas of this country were kept going—

Mr. Dalton: I do not wish to interrupt my hon. Friend, but I am most anxious, as is my right hon. Friend, to give information, and I do not think that the particular point which my hon. Friend is now raising does arise under this Clause. This is a Clause designed to extend these guarantees for such purposes as those indicated by the hon. and gallant Member for Aston (Commander Prior). I submit that my hon. Friend's observations would be in Order at a later stage, but not here.

Mr. Petherick: My hon. and gallant Friend the Member for Aston (Commander Prior) was quite right to ask the questions that he put. Frankly, I had not previously understood completely the full scope of the Clause as it is at present drafted. I had the idea that it was really to facilitate Empire trade in the case, for example, of rubber exports from Malaya to Russia, or some other foreign country—transactions negotiated by United Kingdom firms. With that I would be in complete agreement, so far as I am in agreement at all. It is absolutely right to use these credits, not only for British manufactures made in this country and sent abroad, but also in respect of British raw materials coming from Empire countries to foreign countries. So far so good. But the Clause as at present drafted goes much further, and that is what alarms me. As my hon. and gallant Friend has discovered, it will be possible to guarantee shipments from Surabaya to New York.
1.30 p.m.
Some years ago, before I became a Member of the House, I happened to be one of the managing directors of a firm of British timber agents. We acted as shippers' selling agents. We placed the timber, not only in this country but in

various Continental countries as well. In return for that service of selling we received a very small commission, which generally amounted, after deduction of discount, to 3 per cent. net, including delcredere. It might have been the case that we took reasonable risks then, but in the post-war world it is going to be a much more hazardous business than it was in the years from 1918 to 1939. It seems, looking carefully at this Clause, that it would be perfectly possible for export credits to be granted in respect of shipments of timber from Finland to Spain. I think that is wrong. I do not think British credit ought to be spent or pledged for purposes such as that. If we could get some kind of assurance from my right hon. Friend that these credits would not be used for that sort of trade, some of us would feel much more happy about it. If the object is merely to facilitate exports, well and good, but I hope we are not going to pledge our rather exiguous credit in transactions on which we get very small returns, and on which possibly we may lose money.

Mr. Mack: There seems to be a little ambiguity on this matter. Clause 2 gives power to the Board of Trade to facilitate and to give certain guarantees to exporters:
Any company incorporated under the law of any part of the United Kingdom for any person (including a company) carrying on business in the United Kingdom in connection with the sale or an agreement for sale of any goods for delivery outside the United Kingdom.
Do I interpret that to mean that if a British merchant wishes to export something from India to South Africa, both of which countries are connected with this country, facilities would be given to him on that basis? Would it be necessary for the merchant or exporter to have business associations in this country to have the backing of the Board of Trade? Then there is the question of unmanufactured goods. I do not think that the great proportion of goods exported from this country would be, in the strict sense of the term, "unmanufactured" goods. Certain of them are partly manufactured and partly processed, but there are other goods which we call raw material. I would like it if some kind of description could be given, in connection with these guarantees, of unmanufactured goods and primary products and whether they would constitute a considerable proportion of all


the goods which are exported. I appreciate that it is just a brief outline of what the Bill incorporates and it is not possible to know what lies at the back of the Board of Trade's mind, but I would like if possible such an explanation.

Mr. Granville: May I ask the right hon. Gentleman to tell us whether the provisions of this Clause cover exports say from Sumatra to America or somewhere else? Would he make it quite clear whether that applies to British firms in the sense of a firm registered in this country, with full operations in this country, or does he mean that for a firm to have a partner or an interest in some agency here, is sufficient?

Mr. Wootton-Davies: I wish to support the hon. Member for Penryn and Falmouth (Mr. Petherick). I hope that the right hon. Gentleman will give due consideration to what he said and also to what was said by my hon. Friend opposite, with whom I do not always agree. In this country in the past we have done a quite large re-export trade on which our commissions and profits have been very small, and I would agree that it is not fair that the national credit should be pledged to ensure a business which is very often done on a commission of a half per cent. or even less. I do think that that is an important point. As a matter of fact this Bill is largely a Bill, I take it, to support weak traders. The hon. Member has told us about the risk which is taken, and I hope we shall continue to take those risks. But I should be glad if he would deal with the point of the exports.

Mr. Johnstone: The question asked by the hon. Member for Penryn and Falmouth (Mr. Petherick) and by the hon. Member opposite, can really be answered in the affirmative. The object of this Bill is to make easier, and to retain for this country the very large business in international merchanting, which has been and we hope will continue to be a very great asset to this country, particularly from the point of view of earning foreign exchange. The kind of transaction that we have in mind is exactly that described by the hon. and gallant Member. A merchant firm in this country dealing in some commodity, and earning a proper commission, is faced by times of difficulty, that are covered by the Export Credit

Guarantees Department, such, for example, as transfer risks. It is an unfortunate and unavoidable fact that during the war there has been a tendency for the United Kingdom to lose much of this business. A particularly important example is the dealing in Australian wool. Australian wool for the United States was financed almost entirely by merchants in this country and there has been a tendency during the war to lose that business.
It is, I think, wrong to under-estimate the importance of what is called these trifling commissions. They amount in the aggregate to many millions, and we wish to be able to earn those millions which in effect are earned wholly in foreign exchange of one kind or another, which is still extremely important to us. It is for that reason that this Clause has been inserted. It applies only to firms in this country. It would not apply to a firm of merchants the members of which were British and United Kingdom citizens by birth, who happen to be established, say, in Calcutta. It applies solely to firms which are carrying on their business in this country, and it applies equally of course to Dominion, Colonial and to foreign commodities. It is strictly limited, and the wording of the Bill has to make allowance for this. A question has been asked in regard to unmanufactured goods. There are of course some raw materials which are partly processed. Most wool is shipped is scoured form, and it might be reasonable to argue that that was in fact in process of manufacture. One has to allow for that, otherwise raw materials of that kind could not be included.

Mr. Mack: I am still not sure whether this explains what is meant by "unmanufactured goods and other primary products." I am not aware that there are exports in any considerable quantity of primary products, in that sense of the term. Also, if a firm which is registered in this country has the vast preponderating bulk of its trade in some other country, would that fact entitle that firm to have the benefits of this Bill?

Mr. Johnstone: If a firm has a London office and is, by origin, a United Kingdom firm, the fact that it has branches elsewhere would not debar it from being able to take advantage of these facilities. You


could not bar a firm because it happened to have a branch in Calcutta, or if it had 20 branches in 20 other countries.

Mr. Mack: To what extent would that benefit this country if the firm is merely registered here?

Mr. Johnstone: The foreign exchange would come here.

Mr. Petherick: I am not at all happy after the reply which has been made by my right hon. Friend. Of course, we should wish to maintain this trade between foreign countries and ourselves, or between the Empire and foreign countries after the war. Trade has been encouraged in London, on which London got commission, and we all know that it the risk is a reasonable one, that trade will go on and may increase after the war. That is a very different thing from using part of the export credit of the country to facilitate that kind of trade. Surely that trade could stand on its own. The individual merchants or financial houses will assess the relative risks of the market, and they will go on taking them, if it is good business. An hon. Member has mentioned the case of a half per cent. commission being taken in certain cases. In such a case, how on earth is the trader concerned or the negotiator concerned to be able to pay the premium in respect of the export credits? There will be nothing left.
A great deal of this trade is done on a very small commission, profit or turn-over basis. That is for the individual trader to assess and I do not think it is right that the export guarantees scheme should facilitate that sort of trade. I should be alarmed if, in the future, the export guarantees scheme were used for purposes other than that of facilitating export from this country or from the countries of the Empire. It is perfectly fair and right if we view the scheme as a whole but we must not use this country's credit facilities for transactions on which the return to this country is very small in individual instances. Those risks should be taken by the manufacturers or the negotiators concerned.

Mr. Colegate (The Wrekin): I think I must differ from my hon. Friend. I do not think he has approached this matter from quite the right angle. The

fact is that in this trade which it is proposed to finance the returns are not all limited to the half per cent. or to the small commission. It is bound up with the whole question of this country's markets and the insurance. The fact is that transactions of this kind are done in the same market in London, and I do not see any reason why we should not maintain the shipping, merchanting and insurance position of this country which has been an extremely profitable trade in more senses than one to this country in the past and we should do our utmost to build up here.

Question put, and agreed to.

Clause ordered to stand part of the Bill.

CLAUSE 3.—(Financial provisions.)

Motion made, and Question proposed, "That the Clause stand part of the Bill."

The Deputy-Chairman (Mr. Charles Williams): I ought to point out now that if this Clause is passed the new Clause [Amendment of s. 6 (2) of the principal Act] standing on the Order Paper cannot be called.

1.45 p.m.

Mr. Ellis Smith: I take it that, within reason, we shall be able to discuss how the accumulated profits can be used in future?

The Deputy-Chairman: The accumulated profit is assigned under this Clause. If this Clause is passed, we cannot go back on that matter. This is the point at which to discuss the accumulated profit.

Mr. Smith: Thank you, Mr. Williams, for that advice. May I emphasise the observations that I was making about premiums, when I received the advice of my right hon. Friend? I happen to come from a locality which has probably taken more advantage of the facilities provided by this Bill than any other locality. In that area there would have been thousands more unemployed but for that fact. The chief complaint appears to have been that they considered the premiums too high. In industry one has constantly to have regard to the cost of production, yet there are charges of all kinds on the products turned out of the factories.
This is a serious matter. If the Department are covering themselves one can understand them wanting to make a business proposition of it. The accountancy has probably been done as efficiently as in the best firm in this country, and the success of the management of this fund is probably an indication of the efficiency of British enterprise. I do not want anybody to misunderstand me. I believe that the Russians also have been concerned about the premiums which have been charged. Therefore, I think the Committee should be given some information on those points. I understand that the profits that have been made on the management of this fund have accumulated in the past to the extent of approximately £1,500,000. Is that so?

Mr. Dalton: Approximately.

Mr. Smith: I am optimistic enough to believe that if we pursue an economic policy in future that will enable this country to work to its maximum industrial capacity, the profits will be much greater than they were in the past—if there is a bigger turnover.

Mr. Colegate: There will be bigger risks.

Mr. Smith: I agree; but I hope that we shall profit by our past experience and avoid the effects of the international situation that we had before the war. If the big nations will pursue a policy of attempting to stabilise world conditions, the effects may not be so great as in the past. If that reasoning is correct—and I hope it is—the question will be, How are these profits to be used? The Secretary of the Overseas Trade Department referred to international merchanting. I believe that there will be an enormous amount of that after the war. One of the most important questions with which the world, and especially the big Powers, will be faced will be the use to which we put the accumulated surplus stocks that will arise, first, out of war conditions, and, second, from the increased mechanisation of agriculture after the war. Here is where the big Powers, in particular, can lay the foundations of an early restoration of international trade. This will become an urgent matter immediately upon the termination of hostilities, and I ask if these profits are going to be used to assist us to deal with these surpluses. I have a statement here which was presented to the House in 1941. In 1941 we had a number of

those statements, which people are beginning to forget now. I think those were great steps forward in the right direction, but, unfortunately, as we have got through the critical situation we were in then, the same attention is not being given to these matters. These White Papers deal with the surpluses that we built up in New Zealand and in Australia.

Mr. Dalton: What is my hon. Friend quoting?

Mr. Smith: Command Paper 6188.

Mr. Dalton: What is the title?

Mr. Smith: One is a statement of policy in regard to New Zealand surpluses, and the other is a statement of policy in regard to the Australian surpluses. The accumulated profits should be used for facilitating after the war the same kind of co-operation that is taking place between the Commonwealth nations during the war. Here is where Britain can lay the foundation of a new economic policy, provided we are prepared to apply modern policies to our post-war needs. It was either the President of the Board or the Secretary of the Overseas Trade Department who stated that the risks within the Commonwealth itself would be relatively small. I readily accept that, but there will be great risks for some time with regard to insurance and shipping. Therefore, in these exchanges, concerns will probably want to utilise the facilities provided in this Bill to cover the increased charges that will arise out of the risks on shipping.

Mr. Johnstone: My hon. Friend made a point about the premiums which are charged. I hoped that my right hon. Friend and I had managed to clear up that matter on the Second Reading. One cannot take very abnormal premiums and make no profit. In fact, the trading accounts of the Department over a long period of years almost exactly balance. The reserve in hand of £1,250,000 is very modest, in view of the scale of operations of the Department; and before the war ends that will have been further reduced owing to abnormal losses which the Department has been bound to make during the war. I think it is fair to say that the premiums have been very accurately and efficiently fixed, so as to produce neither a severe loss to the Exchequer nor an abnormal profit to the Department,


and I think we can congratulate the underwriters employed by the Department upon that fact. As to the use of this reserve—for that is what in fact it is—I should have thought it was clear that for the scale upon which the Department has been operating the accumulated reserve is only just about big enough to carry the business.
I should very much regret, and I think it would be very inappropriate, if this accumulated reserve were diverted to any other purpose. It would produce rather a peculiar state of affairs, because the objects to which my hon. Friend would like to devote any such profit—if profit it may be called—would remain every year in extreme suspense about what was going to happen the next year. Let us assume that one year the Department makes £100,000 profit—if profit you like to call it. Presumably that £100,000 will be allotted to the purposes, about which I am not clear, to which my hon. Friend would like it diverted. If in the following year the Department makes a loss of £200,000, is the beneficiary in the good year going to be made responsible, or what is to happen? Or is it only when a profit is made that the sum is to be allocated to this special purpose? If my hon. Friend has in mind some useful purpose which can be served, in connection with Empire trade, by the allocation of a sum of money, I suggest that it is not from this source that it should come. He made special reference to shipping risks after the war. There is no doubt that for some time after the war, as after the last war, there will be unusual risks from mines and so on, but it has never been the practice of the Department to go in for marine insurance, and we have no practice in it. We should have to acquire special underwriters, with marine knowledge. Marine insurance is a very great speciality of the United Kingdom, and I think it is adequately looked after by Lloyds and the companies.

Mr. Granville: I am a little disappointed with the reply of the Secretary of the Overseas Trade Department and very sorry that he was not more responsive to the suggestion of my hon. Friend the Member for Stoke (Mr. Ellis Smith), who has been sitting through this Committee stage with great patience and has at last, with great Parliamentary

skill, been able to demonstrate that the party for which he has been speaking is very anxious to promote Empire economic unity. We have had indications of this trend in that party in the speeches of the hon. Member for Seaham (Mr. Shinwell), and I gather that the Labour Party is now overwhelmingly in favour of finding some method, under this Bill or otherwise, of increasing and stimulating Empire economic unity.

Mr. Ellis Smith: This matter needs to be made quite clear. There has, unfortunately, been a great deal—

The Deputy-Chairman: This discussion is getting much too wide. The Debate has already gone very wide.

Mr. Granville: I intended only to refer to that matter. I hope the right hon. Gentleman will bear in mind the speeches on this subject, and will discuss it with the Dominions Office and the Colonial Office, to find some method of earmarking part of this fund for stimulating export trade from this country to the Dominions and to finance and assist some of the suggestions made during the Committee stage. I hope that the right hon. Gentleman's response to the suggestions of my hon. Friend are not the last word, and that he will give this matter further reconsideration.

Question put, and agreed to.

Clause ordered to stand part of the Bill.

Clauses 4 and 5 ordered to stand part of the Bill.

Schedule agreed to.

Bill reported, without Amendment.

Motion made, and Question proposed, "That the Bill be now read the Third time."—[Mr. Mathers.]

2.3 p.m.

Commander Prior: I have worked for over 20 years in the commodity markets in many parts of the world, and may I, therefore, be permitted to thank the President of the Board of Trade for having included primary products in this Bill? The usual manner of financing commodities is through the London money market. In pre-war years this market lost much of its elasticity and drive, and, in fact, during the Munich crisis, it practically closed and had to be prompted by the Bank. Although the British Empire is the greatest producer of commodities in


the world, this is the first occasion on which primary products have been included in an export guarantee. Producers will be faced with a Herculean task to repair the ravages of war and to get their businesses under way again, for they are businesses on which depend the livelihood of very many persons. Here, in Great Britain, we are a great entry port of commodities for the whole of Europe, with the various businesses of wharfage, warehousing and exporting, quite apart from the questions of insurance and finance. Our whole civilised life depends upon an ample supply of basic materials, and any aid which can be given to the British exporter must, of necessity, improve the flow of his exports, and, in turn, not only benefit the British Empire but the whole world at large.
Many speakers in the Debate feared the competition of the United States, and inquired how we were to pay for our imports from that country. In years gone by, many of our imports were offset by the States' purchases of commodities in the British Empire. In Germany, I often argued about the very unfavourable balance we had, and I was immediately countered with the remark, "Look at all the raw materials we buy from your Empire." The Government have always been criticised when a Department makes a loss—

Mr. Deputy Speaker (Mr. Charles Williams): This is a Third Reading Debate, and it has nothing to do with what the hon. and gallant Gentleman would like to see in the Bill, or with his experiences. These are matters which might be suitable for a Second Reading speech, but are unsuitable now. The hon. and gallant Member can only deal with the actual contents of the Bill.

Commander Prior: The only criticism that I would make of the Bill is that it is too small. Manufacturers have already written to me saying that they will use this Bill to a very great extent, and the President of the Board of Trade has already indicated that that difficulty may very largely be overcome. I desire to thank the President for having done so much to give help to a very deserving body of men, who, by their products and their exports, will do so much to improve and promote the prosperity of the world.

Mr. Ellis Smith: We welcome the introduction of this Bill, and we have facili-

tated its passage through the House. I desire to thank the President and the Secretary to the Department of Overseas Trade for the courteous manner in which they have dealt with questions raised in the discussion.

2.7 p.m.

Mr. Petherick: I do not think the Ministers concerned are other than happy at the progress which the Bill has made and the speed with which it has been carried through the House. I would like to say one or two things, even at the risk of being accused of having said them before, but I think they are rather vital. The first point is that it is not enough merely to raise the money to be given in export credits under this Bill. Its success will depend on administration, and I hope that, in future, rather more care will be taken to divert as much as possible of the guarantees Which are to be granted under the Bill to the Empire rather than to foreign countries. The total amount is limited, and I am very glad that it is, but I am not sure that it is not too large, in relation to the rest of the finance of the nation and its trade after the war.
I hope that as much as possible will be used in respect of guarantees for exports to the Empire, and, on that subject, I would like to make one point. It has been said that this is unnecessary, because the risk is such a good one and there is very little default. In some cases, of course, there will be exports for which the term will be long, and, perhaps, repayment is not due for four or five years, or, indeed, longer, and there, in the case of a private firm, will enter the question of solvency. Therefore I hope that, if there is any doubt, in a case in which it is desired to use the export guarantee, and in which a manufacturer makes application and his exports are to go to Empire countries, he will, if possible, even if the total amount available in respect of export credits at that moment happens to be small, be given preference over an exporter who is sending his goods to some foreign country.
There is one more point, and, though I think it is a repetition, I think it is very important. I hope that these guarantees will not be given in the case of those countries which have a favourable balance of trade with us. If a country has a favourable trade balance of, say,


£20,000,000, that is to say it exports £20,000,000 worth more to us than it buys from us, that country will have £20,000,000 sterling available for use in buying British manufactures. There is no necessity whatsoever, so far as I can see, to give further export credits on top of that, and our Government should tell that country, "You can use up your £20,000,000 sterling which you have got in buying goods from this country."

Mr. Benson: May I interrupt my hon. Friend? A moment ago he said he hoped that the export guarantees would be directed towards the Empire. Now he says that any country with a favourable balance with this country should not be allowed the guarantee. There is no single Colony or Dominion that has not a very large credit balance in this country, and my hon. Friend's proposal would cut out this guarantee completely with regard to the Empire.

Mr. Woodburn: The hon. Member has raised a very important issue of trade. If his arguments were accepted, would it not mean that there would only be bilateral trade? If there is multilateral trade, the payments by export balances may not be made at all, because they may be paid for indirectly.

Mr. Petherick: My argument was only applied to foreign countries. I am quite aware that some Colonies have favourable balances with us, but some of them have not. I confined my argument to the case of foreign countries, and I said that, if one has sufficient sterling at its disposal with which to buy British goods, we should not pledge British credit by giving further export guarantees that are not necessary. I do not expect a positive guarantee from the right hon. Gentleman in reply to that, but I hope that the Export Guarantee Committee will consider the matter and not be too liberal in the direction I have mentioned.

2.13 p.m.

Sir William Wayland: I congratulate the Government upon the Bill. As one connected with the export trade, I can say that it will be a very great benefit, especially to those who are not possessed of very much capital. Hitherto, those who have been offered very large orders from foreign countries

have had to consider whether they could afford to finance them. If a business man thought he could make up the 10 or 15 per cent. balance which was required by depositing his documents, he could accept the order, but if he found he could not get that 10 or 15 per cent. balance, presumably, he had to refuse the order. Under the conditions of this Bill, that will not take place, for he would then be able to go to the Committee and say, "Here we have received an order from a foreign country"—South America or anywhere else—"and we have to find £100,000. We cannot find it, and we cannot accept the order, but, if you can advance or guarantee, say, £90,000 or £95,000, we could find the other £5,000." That is where the great benefit of this Bill will come in.

2.15 p.m.

Mr. Dalton: I am grateful to my hon. Friends who have participated in the Third Reading discussion for their good wishes and for their support of the policy in this Bill. My hon. and gallant Friend the Member for Aston (Commander Prior), whose support I was very glad to have, has personal experience in regard to the value of Clause 2. I am greatly obliged to my hon. Friend opposite for the way in which he, and those who work with him, have assisted the passage of the Bill. I am also much obliged to my hon. Friend the Member for Canterbury (Sir W. Wayland). On the point raised by my hon. Friend the Member for Penryn and Falmouth (Mr. Petherick), he will not expect a firm commitment or a new declaration at this late stage. But what has been said will, I am sure, be pondered by the Advisory Council. Indeed, I shall ask them to read all the Debates on this matter carefully before setting forth upon their new and extended responsibility for the extension of credits which I hope this House is now going to approve.
We have had some very useful and interesting Debates, and with a final word on Empire trade, I will close. There is no difference of view anywhere in this House now as to the great importance of expanding and extending Empire trade by whatever means possible. If it was ever controversial, it is controversial no longer. There are still differences of view on the best way to do it. Whether this Bill is the mechanism for doing it, or whether it should be achieved by other


means, we are all agreed on the broad objective, and if there is anything that I can do, and that we can do in our Departmental work, we shall do it. I hope that the House will now give us the Third Reading of the Bill and I wish to express thanks to all those who have contributed to the discussion and illuminated the subject.

Question put, and agreed to.

Bill read the Third time, and passed.

Orders of the Day — LOCAL AUTHORITIES LOANS [MONEY]

Resolution reported:
That for the purposes of any Act of the present Session to prohibit the borrowing of money by local authorities otherwise than from the Public Works Loan Commissioners, to amend section five of the Public Works Loans Act, 1941, and to make further provision with respect to local loans and the borrowing powers of local authorities, it is expedient;

(a) to authorise the issue out of the Consolidated Fund of any sums required for the local loans fund which could be raised by the creation of local loans stock;
(b) to authorise the Treasury to raise money for the purpose of providing sums to be issued as mentioned in the preceding paragraph in any manner in which they are authorised to raise money under the National Loans Act, 1939;
(c) to authorise the repayment into the Exchequer of the sums issued as aforesaid, together with interest thereon;
(d) to authorise the issue out of the Consolidated Fund of sums paid into the Exchequer as mentioned in the last preceding paragraph and the application of sums so issued in redemption or repayment of debt or, in so far as they represent interest, in payment of interest otherwise payable out of the permanent annual charge for the National Debt."

Resolution agreed to.

Orders of the Day — LOCAL AUTHORITIES LOANS BILL

Considered in Committee.

[Mr. CHARLES WILLIAMS in the Chair]

CLAUSE 1.—(Prohibition of borrowing otherwise than from Public Works Loan Commissioners.)

2.18 p.m.

Sir John Mellor: I beg to move, in page 1, line 5, at beginning, insert:
During the period of five years from the date on which this Act shall have come into operation.

The purpose of this Amendment is to limit the operation of Clause 1 to five years. This Clause prohibits local authorities from borrowing otherwise than from the Public Works Loan Commissioners, except with Treasury consent. In his Second Reading speech, the Chancellor of the Exchequer repeated an assurance which he had given already to the local authorities that the prohibition would only be continued as long as may be necessary. During the Second Reading Debate I raised the point whether that assurance would be binding upon Chancellors of the Exchequer in future Governments and the Financial Secretary, in his concluding speech, said most emphatically that in his view it would be binding. The speech made by the hon. Member for East Stirling (Mr. Woodburn), who spoke on behalf of the Labour Party, immediately following the speech in which the Chancellor of the Exchequer had referred to that assurance, was most illuminating. He began in this way:
On behalf of my hon. Friends I welcome this Measure as a step towards the tidying up and the improvement of our general financial relationships.
Later in his speech, referring to the Chancellor of the Exchequer, he said:
This might mean a temporary Bill. I hope that that is not the case. In practice I am satisfied that it will justify itself and will be permanent."—[OFFICIAL REPORT, 24th January, 1945, Vol. 407, c. 918 and 924.]
That speech, being made immediately following the Chancellor of the Exchequer's assurance, indicates that in the view of the official spokesman of the Labour Party that assurance would not count for very much. If I have misinterpreted what the hon. Member for East Sterling intended, I shall be very glad indeed to give way.

Mr. Woodburn: The point is that the Chancellor of the Exchequer said that he would consider it after five years and nothing that I said prevents consideration of the Measure after five years.

Sir J. Mellor: The Chancellor of the Exchequer said that this prohibition would only be continued as long as is necessary, and I submitted that that assurance would not, unless incorporated in the terms of this Bill, in any way be binding upon Chancellors of the Exchequer in future Governments. I was only


pointing out that the hon. Member for East Sterling, speaking on behalf of the Labour Party, supported my contention, which had been rejected by the Financial Secretary to the Treasury. But supposing this assurance were binding upon future Governments, what is it really worth? "As long as it may be necessary" is a very vague expression and can easily be interpreted to suit the taste and fancy of any administration that may happen to be in office. The Financial Secretary to the Treasury also contended that it was inappropriate to have a time limit introduced into the terms of the Bill. He said:
The local authorities themselves have never asked for a definite time limit to be placed in the Bill on this scheme. They asked for the assurances that we have given.
That may have been the case, but I understand that a very large number of the local authorities consider that the assurance should be reflected in the terms of the Bill. I have been assured by my hon. Friend the Member for Stone (Sir J. Lamb), who is Vice-Chairman of the County Councils' Association—and what I say, no doubt, he will confirm when he speaks later in the Debate—that the County Councils' Association desire this Amendment. In so far as I have been able to have informal communications with persons who are concerned with local government finance in my constituency I have found that they take the same view and desire to see a time limit in the terms of the Bill. The Chancellor of the Exchequer said that one reason why it was inappropriate to have a time limit was that this is a novel scheme. That is a very strong reason for having a time limit in order that there may be an automatic review in this House when we have gained some working experience of the scheme. The Financial Secretary also said:
It is quite impossible to forecast now what will be the period of years for which this scheme will be necessary. It may be four, five or six years." [OFFICIAL REPORT, 2nd February, 1945, Vol. 407, c. 1789 &amp; 1790.]
Taking the longest period the right hon. Gentleman named—six years—I am prepared, if the Government will accept it, to alter this Amendment, if the Committee will permit, from five years to six. All that I want to secure is that there is a definite time limit in the terms of the Bill which will secure the automatic re-

consideration by Parliament at a reasonable time. The reason I took the period of five years as in my view most suitable, is that the Chancellor of the Exchequer has undertaken at the end of four years to review the whole matter with the local authorities. Unless we have some automatic review by Parliament provided for within a definite limit of time this sort of thing may roll on for a very long time, if not for ever.
Clause 1 gives immense power to the Treasury and we know that Government Departments—and I do not blame them—like to have all the power they can command. They have great confidence—often rightly—in their own capacity for administration and believe that if they have more power the better for the country. That is their view, and they are entitled to it, but there is no reason why we should share it. It is our duty when we have a Measure which is only proposed to be temporary—this is the Chancellor of the Exchequer's case—not to introduce it in permanent form. If we do it in this case and enact Clause 1 in permanent form we shall be setting a very bad example for further legislation which will come before this House in the near future dealing with the multitude of matters arising for the period of reconstruction. We should say in the terms of Clause 1 exactly what we mean. If we mean its operation to be temporary, we should say so and impose a time limit.

Mr. Colegate: I am very glad that my hon. Friend the Member for Tamworth (Sir J. Mellor) has put down this Amendment on the Paper, and I have every intention of supporting him, because I know that there is a very wide feeling among local authorities that some such protection as is provided by the Amendment should be put into the Clause. This is the first time in 50 years—it is 50 years since the last great Measure of local government was introduced—that there has been a proposal before the House of Commons to diminish or take away powers of local authorities. This financial autonomy was one of the marks by which this vigorous system of local government was known to everybody, as something which was, to a very considerable extent, independent of the central Government. Now we are proposing to carry through a Bill which would take away one of the most cherished privileges


of any form of self-government, namely, the power of finance. It is essential, therefore, that this Committee, before it allows the powers of local authorities to be tampered with in this way, should set a very definite time limit to the period during which the Bill should operate.
It must be remembered that this is being done just at the moment when Parliament is placing upon the local authorities the biggest burden of work that has ever been placed on the shoulders of local authorities. These things are not going to be carried by the Government or by the House of Commons. The great burden of the housing programme and other things has to be carried by the local authorities in this country. Therefore it is essential that we should do everything in our power to maintain the prestige of the local authorities, because we have to attract to this service some 20,000 or 30,000 unpaid people in every department of local government. Is this the time to lessen the prestige by reducing the status of the local authorities? Surely not. However much we sympathise with the purposes of this Bill, it is necessary that there should be this protection of a time limit.
2.30 p.m.
Let me say a word with regard to the assurances that have been given. We have heard many complaints of legislation by reference, but some of us are beginning to think that the real danger is legislation by assurance, because each Bill is accompanied by a mass of assurances which we cannot get put into the Bill itself. As the hon. Member for Tamworth pointed out, Governments change, opinion changes, and it may well be that a Chancellor of the Exchequer in three or four years' time may not be in a position to honour the assurances which are being given by the present Chancellor. That is not unknown; it has happened before. It is to the House of Commons alone that the authorities look for their protection, and surely, therefore, it is for this Committee now to say very definitely, "If we do agree to discrimination in the powers of local authorities for a certain definite period, we shall limit it to some such period as five or six years." It is essential that we should put that protection in the Bill, so that everyone concerned—the central Government, future Parliaments, and the local authorities—may know exactly where they stand.

Sir Joseph Lamb: On behalf of the County Councils' Association, I should like to associate myself with this Amendment. Its purpose has been so clearly stated by the last two speakers that it is perhaps unnecessary for me to say much more, but let me say clearly that I believe the local authorities are very desirous of assisting the Government in every way they can in the social work which is being placed upon them. It is only that desire to assist the Government which induced them to accept the proposals in this Bill. I must make that quite clear because, as the hon. Member for The Wrekin (Mr. Colegate) said, it is an infringement of rights which the local authorities have enjoyed for many years.
It is true that an assurance has been given, but what is the meaning of the word "assurance"? I think it means something that must assure, and unless there is something in the Bill itself there is no assurance. The very fact that it is not in the Bill leads us to doubt whether the assurance is really genuine, because no matter how much we may respect the words of those right hon. Members who speak from the Front bench, they are effective only for ourselves personally, and, when it comes to a question of administration, we are told that what is not in the Bill is not effective. Consequently, I am afraid I must say definitely that the omission to put anything in the Bill does not coincide with the statement made when we were discussing this point.
We ask seriously if this is to be a temporary Measure. If it is, I take it that it will be for the purpose of enabling the local authorities to obtain money at reasonable and lower rates than perhaps would otherwise be possible, because of the tremendous demand there will be for money after the war. So we ask whether it is to be a temporary Measure, and we must have that assurance in the Bill. If it is to be a permanent one—and here again I say that if it is not in the Bill it will be permanent so far as practical politics are concerned—then I fear we must oppose it, because it is giving away rights which the authorities have exercised for many years without a real assurance that this is a temporary Measure for the advantage of the country during a period which will, perhaps, be a very difficult one if we are to erect all the buildings necessary and to obtain all the


money for our social services at reasonable rates. I have not much more to say on the point, except that I am authorised to support this Amendment, and I hope the Government, by the fact of including it in the Bill, will justify our acceptance of their statement that it would be limited to four or five years.

Mr. Lewis: I want to support the Amendment, and would ask hon. Members to consider what the position will be in four or five years' time, when, presumably, we shall be back to the system of party government. If this Amendment is carried, and the Bill is due to lapse at the end of five years, it would in the event of the Bill giving general satisfaction, be a very simple matter for the Government of the day to promote a one-Clause Bill to extend its time. Suppose, however, that the Amendment is rejected and that the Bill does not give general satisfaction; suppose there are some local authorities who feel aggrieved with what has happened under it, either because they feel they have been unduly delayed in getting the money they want or because they are not satisfied with the terms on which the money has been available; and suppose the Treasury wants the Bill to continue. Perhaps hon. Members will consider how difficult it would be under those circumstances to pass a Bill putting an end to this one. The Chancellor of the Exchequer, in his speech on Second Reading, said:
… it has been confirmed that the new scheme will continue in operation only for so long as it is necessary."—[OFFICIAL REPORT, 24th January, 1945; Vol. 407, c. 909.]
Yes, but who is to decide whether it is necessary or not? There might be a sharp conflict of opinion between the Treasury, on the one hand, and many local authorities on the other, and I submit that under those circumstances it would be most difficult for those local authorities to get effective action taken in this House. For that reason, I would urge that the Amendment is a reasonable and desirable one.
Here I would like to comment for a moment on the absence of the Chancellor of the Exchequer. This Bill is his Bill; his name appears on the back of it. This Amendment is an important one, asking for a substantial alteration in the Bill, and the Chancellor is not here to listen to the arguments that may be brought forward in favour of the Amendment. I see

the Financial Secretary to the Treasury, but his presence is a very different thing. I have no doubt that the present Financial Secretary to the Treasury has a lively recollection of the fact that a predecessor of his once lost his office because he accepted an Amendment in the absence of the Chancellor. My right hon. Friend, being a cautious man, is not likely, I think, to repeat that experience this afternoon—[An HON. MEMBER: "Not now that he has been warned."]—and I challenge him to answer this question when he replies: Has the Chancellor of the Exchequer authorised him this afternoon to listen to the arguments in favour of this Amendment and to exercise his judgment as to whether they are sound or not, and to accept or reject the Amendment accordingly? Has he instructions from the Chancellor of the Exchequer to reject the Amendment in any event? I think the Committee is entitled to know that.

Captain Thorneycroft: I rise for only a few moments to say that I hope very much that the Financial Secretary, whatever authority he has from the Chancellor, will, in fact, resist this Amendment. I believe that my hon. Friends who have argued their case with great moderation, are on bad ground on this point. I thought it was generally agreed on all sides of the Committee that some form of control of public investment had to be exercised for a number of reasons, and not least in order to maintain some kind of stability of employment. The Chancellor of the Exchequer, I understand, gave an undertaking that the question would be reviewed after four years. May I say that I have not the slightest doubt, if there were a Labour Chancellor of the Exchequer at that time, that he would review it with the local authorities and discuss the problem with them? The suggestion was made, however, that if the Government changed the pledge would not be honoured. I say that if there were a change of Government that pledge would be honoured. [An HON. MEMBER: "Why?"] I am certain that if there were a Labour Chancellor of the Exchequer the principle of this Bill would be continued. I hope very much that the principle will be carried on. I am really rather at a loss to understand the attitude of the hon. Member for The Wrekin (Mr. Colegate)—a neighbouring division of mind—whose views on these


matters I always respect because I know that he has studied this subject very closely. He emphasised the burdens being placed on local authorities at the present time, the legislation which is being passed, the housing programmes, and asked whether this was the time to take away their powers. Surely it is just because we are placing these burdens and programmes on them that we do not want them all to rush into the money market at the same time. We must exercise some control.

Mr. Colegate: This Clause has nothing whatever to do with access to the capital market. That has already been provided for by the Capital Issues Committee, as was pointed out by my right hon. Friend the Financial Secretary in his speech. Nothing we say or do on any part of this Bill will affect the queueing up for the capital market.

Captain Thorneycroft: This is a Government agency, and the point is perfectly simple. I appreciate the point made by my hon. Friend, but clearly, when we have an enormous programme of work of this kind, some such agency is required. I think there is no difference between us, because my hon. Friend admits that it is required for the reconstruction period. My own view is that it will be required in the future as well. I hope, for those reasons, that the Financial Secretary will reject the Amendment.

Sir J. Mellor: Do I understand that my hon. and gallant Friend desires the prohibition in Clause 1 to remain permanent? If so, what importance does he attach to the assurance given by the Chancellor of the Exchequer that this prohibition will not be continued longer than is necessary?

Captain Thorneycroft: The importance I attach to the pledge is that I am sure it will be honoured by any Chancellor of the Exchequer. At the same time I hope that any Chancellor of the Exchequer will continue the principle which is established in the Bill.

Mr. Butcher: I always listen to my hon. and gallant Friend the Member for Stafford (Captain Thorneycroft) with great interest and attention, because I know how deeply he is impressed by this problem, but, if he will allow me to say so, I think he has completely misunderstood the opposition

to this Clause as it now stands. The case put by the hon. Member for Tamworth (Sir J. Mellor), with which I entirely associate myself, is this: is the future Chancellor of the Exchequer—whatever may be his political complexion—to find the assurance written into the Bill, which will be brought to his attention definitely at the end of a fixed number of years, or is he to go searching through the pages of HANSARD for vague assurances made by his predecessor? Those of us who wish to see this Amendment written into the Bill are entitled to ask that the assurances given by the Chancellor of the Exchequer shall appear in the Bill.

2.45 p.m.

Sir William Wayland: I have been asked, on behalf of local authorities, to support this Amendment because they claim that they ought to be able to borrow in whatever quarter they can, whether from Government or outside sources. They plead that, for many years, they have not been subjected to bureaucratic control, and that the tendency nowadays is to centralise everything in Whitehall. They are very much opposed to that. I cannot see why the Government should not accept this Amendment. Unlike any previous speakers, I have no confidence whatever in the promises of any Government, whether Conservative, Labour or Liberal. A Chancellor is in office for a certain time, and any promise he gives applies only so long as he occupies that position. When he leaves, his successors say that they will not be bound by the promises of any of their predecessors. Acceptance of this Amendment would not hurt the Government, because after five years the matter could be revised.

Mr. Gallacher: When I heard the amazing arguments of hon. Members opposite I could not resist saying something on this Amendment. The hon. Member for Holland with Boston (Mr. Butcher) said that it would be better to have an assurance in this Bill, rather than that the Chancellor should search the pages of HANSARD for an assurance by one of his predecessors. I am quite certain that whoever the Chancellor may be, the moneygrabbers on the other side will not let him forget, when we come to the end of the fixed period, that an assurance was given four years previously. Am I to take it from the arguments which have


been put up, that there is a bunch of philanthropists in the country who are anxious to give away money for nothing? What is the situation that exists? In many districts, members of local authorities are associated, directly or indirectly, with those who are financing those authorities, with the consequence that local authorities have to pay far more than is necessary for the money they require. Houses have to be built, and education has to be developed, and the situation demands that there must be a measure of control, to ensure that the best results may be obtained from the money which is available, with the least possible difficulties about interest rates. There is not a Member on the other side who is prepared to oppose the principle of this Bill—

Sir J. Lamb: If the hon. Member had read the Amendment before he started to speak, he would have seen that we were not against control, but were only asking that it should be limited.

Mr. Gallacher: There is not one Member opposite who dare get up and oppose the principle of this Bill. Members on the other side hope that as the years pass they may get into a stronger position so that they will be able to look after their own interests as against those of the community. Control to-day? Yes, because they dare not come out against it, but they are always hoping that in the future they will be able to break control, and rook the country to their hearts' content. Should anything special come up four years hence, Members opposite—if they are still here, and I am doubtful whether most of them will be—will be only too ready to draw the attention of the Chancellor to the assurance that has been given.

Mr. Woodburn: I do not want to take up time discussing the merits of this Bill, which the House has accepted in principle, but it has been suggested that if, by any chance, the Labour Party should be the responsible Government when the time for review of this matter comes up they would refuse to review it. [An HON. MEMBER: "No."] Yes, that suggestion has been introduced to prejudice the Committee in the discussion of this simple Amendment.

Mr. Lewis: Who made that suggestion?

Mr. Woodburn: An hon. Member behind me quite clearly indicated that a Labour Chancellor could not be trusted to review this matter.

Sir J. Mellor: I drew attention to the fact that the hon. Member said in his speech that this might need a temporary Bill, that he hoped that would not be the case, and that in practice he was satisfied that it would justify itself and be permanent. I make no complaint of that, but I pointed out that this was immediately after the Chancellor of the Exchequer had given an assurance that prohibition would not be continued longer than necessary.

Mr. Woodburn: That is another point altogether. If this proves satisfactory to local authorities, when the House reviews the Measure, as it might, it will obviously continue it of its own free will. The only point is whether it is desirable to put into the Bill an Amendment to say that in five years from now the Measure should come to an end. That may be an inconvenient arrangement. To say that the Measure must lapse on a given day would be a most inconvenient way of reviewing a situation of this kind. The question of what Government is in power makes no difference because any Government can carry their will through the House, whatever that will may be, if they have a sufficient majority. I would also like to refute the suggestion that the Labour Party is less responsive to local government needs—

Sir Herbert Williams: Is the hon. Member making the declaration that a General Election has no significance, and that a party has no power to bind its successors?

Mr. Woodburn: If a Chancellor of the Exchequer gives an assurance that a matter will be considered in five years, and the House accepts that, then every party in the House is accepting it, and not merely the Chancellor who is giving the declaration. It is the House of Commons which accepts it.

Sir J. Mellor: The Chancellor of the Exchequer went much further than promising that the matter should be reconsidered in five years. He said that the prohibition would not be continued longer than necessary.

Mr. Woodburn: I say it is not convenient to bring a Measure like this to an end in five years. The local authorities have well-established means of making their wishes known to the House; I have never found them in the slightest difficulty in declaring whether they were pleased with what was happening or not. If the Bill does not work I am satisfied that the local authorities will find means of making their desires known. The suggestion that every local authority has a genius for getting cheap money is simply fantastic—

Mr. Colegate: That does not arise on this Amendment.

Mr. Woodburn: The suggestion has been made that this will hamper local authorities in getting cheap money and that the Government will inveigle them—

Mr. Colegate: That arises on the next Amendment.

Mr. Woodburn: No.

The Deputy-Chairman (Mr. Charles Williams): I think we might keep off that point, until we come to the next Amendment, which does deal with it.

Mr. Woodburn: The argument was definitely brought in that the interregnum between now and the next five years would throttle the local authorities in carrying out their work efficiently. When one remembers what happened in 1929–30, and some of the agencies to which local authorities resorted in order to get money, I think there is some doubt as to the wisdom of all local authorities in this matter. But in any case, on the purely practical point, I think this is a most inconvenient arrangement to say that the Act which will result from this Bill must automatically lapse on a given day, no matter what may be the situation at that time.

The Financial Secretary to the Treasury (Mr. Peake): I have listened to the Debate with interest but I do not think this is a matter over which the Committee need get very excited. It is true that the scheme embodied in the Bill is a temporary measure, and if I thought we could improve it by fixing a definite term of years—four, five, six or eight years or some other period—I should be quite in favour of accepting an Amendment

on those lines. May I say, in response to my hon. Friend the Member for Colchester (Mr. Lewis), that the confidence between myself and my right hon. Friend the Chancellor is such that I have full authority to speak on his behalf in this matter, and that the confidence between my right hon. Friend and myself appears to be a great deal firmer than the confidence between His Majesty's Government and hon. Members who are supporting it from the back benches?

Mr. Lewis: I did not ask whether my right hon. Friend had any authority to speak for the Chancellor; I asked whether he had authority to accept the Amendment if he thought the arguments were sufficiently good.

3.0 p.m.

Mr. Peake: The short answer is that I do not think the arguments sufficiently good, and that I have not heard any arguments raised here to-day which were not present in our minds before, or which were not mentioned in the Second Reading Debate. My hon. Friends the Members for Tamworth (Sir J. Mellor) and for Stone (Sir J. Lamb) both purported to be expressing the views of the County Councils Association. I will read the assurance for which these local authorities asked and I will read the Treasury's reply. On 16th October, in a letter to which the first signature was that of Sir Sidney Johnson, Secretary of the County Councils Association, and which was also signed by the Secretary of the Association of Municipal Corporations, the Secretary of the Urban District Councils Association, the Hon. Clerk to the Metropolitan Boroughs Standing Joint Committee, the Clerk of the L.C.C., and the Secretary of the Rural District Councils Association, they wrote as follows:
The representatives are now prepared to recommend concurrence in principle in the proposals, subject to formal assurances on the following points:

(1) That, as suggested at the meeting by the Chancellor, the new scheme will continue for so long only as is necessary and that, if Treasury control of borrowing has not ceased at the expiration of four years after the end of hostilities in Europe, the future operation and extent of such control will then be reviewed by the Treasury in consultation with the local authorities. …"

On 4th December a letter was despatched from the Treasury to these six gentlemen who acted on behalf of the


local authorities and with their authority. It included this passage:
The new scheme will continue only for so long as is necessary, but my Lords will be ready to review it in consultation with the Local Authorities, at the expiration of four years after the end of hostilities in Europe.

Sir J. Mellor: Will my right hon. Friend agree that, whatever was said in the course of those discussions, it is our business in this House to decide what form we use in the enactment of business?

Sir J. Lamb: My right hon. Friend has put the matter very clearly, and can corroborate what he says, but the assurance will not be effective unless it is in the Bill.

Mr. Peake: It is quite clear that we cannot embody that type of assurance in an Act of Parliament, and that is why my hon. Friend's Amendment has been put down. The House of Commons is not bound by any arrangement or understanding come to between the Government and the local authorities and, of course, it is possible for the House to step in and make some other arrangement setting a definite term of years to the Bill. The mover asked, if we did not like five years, whether we would make it six. I should have thought that hon. Members in every quarter would have seen the extreme difficulty of fixing any period for operations of this kind. No one knows how long it is going to take to establish all the housing schemes which will be necessary after the war. What we want is to arrange for orderly borrowing by local authorities at cheap rates. We have announced what the rates are—they are highly favourable—and we want local authorities to come forward and get their money without delay when their schemes are ripe for putting into effect. Suppose we were to put a definite term in the Bill and have a guillotine fixed; it is then clear that, if these re-housing schemes do not get going as fast as hon. Member's would wish, the local authorities will find themselves up against this time limit.

Sir J. Mellor: The Amendment only affects the prohibition in Clause 1. It does not affect the scheme in the rest of the Bill. Supposing, when the time has arrived, there is a limit of five years, what is the difficulty about a one-Clause Bill extending it by a further five if necessary?

Mr. Peake: The short answer is that no one can possibly tell at present whether this Measure will be required for any specific period between three and ten years. It is impossible to fix any definite time limit at all. No one knows how quickly reconversion processes are going to take.

Sir J. Mellor: Really my right hon. Friend should answer the point a little more candidly than that. What is the difficulty, when you approach the time limit of five years, about introducing a one-Clause Bill to extend the period?

Mr. Peake: I do not think my hon. Friend is really quite doing his case justice. It is clear that local authorities must be able to see a little way ahead. They must be able to know at present that, if they come into the market within the next few years, they will get their money at the cheap rate promised by the Bill. If you have a definite time limit, you will reach a stage where there is a state of uncertainty. No one will know whether the Government are or are not going to introduce a one-Clause Bill to prolong the operation of Clause 1.

Sir J. Mellor: rose—

The Deputy-Chairman: I think it would be better to allow the right hon. Gentleman to make his statement. This is Committee stage, and hon. Members can make further speeches if the statement is not satisfactory. It is more convenient to have a single argument put at a time.

Mr. Peake: I have said that this is a matter over which there is no need, as far as I can see, for great excitement. We have satisfied the local authorities with the assurances they wanted. There will be standing committees of local authorities in England and Wales and in Scotland, throughout the working of the scheme, in constant touch with the Treasury. I should have thought that, if the local authorities, who are the principal persons concerned and upon whom the prohibition is laid by Clause 1, were satisfied with the undertakings that have been given, the House of Commons might have been satisfied also. The hon. Member opposite has made it clear that his party subscribe to the undertakings that have been given by the Chancellor of the Exchequer, but does anyone really think that, if the pledge given on behalf of the Government of the


day is broken, local authorities are not sufficiently influential to see that there is an unholy row in the House of Commons? I should have thought that, the local authorities having expressed their satisfaction with it, the course that we propose is better than fixing a definite time limit, for that is bound to be inconvenient as the period of the Bill draws to a close, and is bound also to result in a great many local authorities promoting hurried schemes in order to try to get their money at a cheap rate before the Bill runs out. All the arguments from the point of view of common sense lie in favour of leaving the matter open now and leaving it to the review, in four years time, which has been promised. I hope that hon. Members will not think this is a matter of sufficient importance to take to a Division. In my view the pledge that has been given is astisfactory. It will be carried out, and it will be more practicable than putting a fixed guillotine in the Bill, which would lead to uncertainty at the time when the legislation will in any case have to be automatically reviewed.

Sir J. Mellor: Would it be in Order to move, "That the Chairman do report Progress, and ask leave to sit again"? I wish to move this in view of the absence of the Chancellor of the Exchequer, and in order to enable the Financial Secretary to discuss with him the arguments which have been adduced.

The Deputy-Chairman: I cannot accept that Motion at the present stage of the Debate.

Sir H. Williams: I am frankly disappointed at the speech of the Financial Secretary. The declaration that a pledge by a Minister in one Government is necessarily binding on its successors, is a complete denial of the freedom of the people to express their view at the polls. This is not the kind of issue which, in itself, is likely to be the subject of great speeches at election time, but this conception that a Minister can bind his successor is something that cannot be tolerated. It is a bad principle and a denial of democracy, and I hope we shall not be impressed by that. The declaration merely binds this Government as long as it exists. We have been told that it is going to cease to exist. As soon as it can deal with Hitler, the Government blows up and disperses into its various

atoms. It will resign and presumably the King will send for the Prime Minister to form a new Government, and the pledge will not be binding for more than a few weeks, and the fewer the better. We have had a declaration from an hon. Member who belongs to the "Amalgamated Society of Straddlebugs." They are members of the Labour Party who sometimes sit here, and sometimes over there. Two or three of them are Ministers and some are P.P.S's. The hon. Member is still a P.P.S. to one of the backers of the Bill. I presume that, when he gets up at this Box, he is really speaking for the Secretary of State for Scotland.

Mr. Woodburn: No.

Sir H. Williams: Where are we? I do not understand these people who are in two camps at the same time, at one minute leading the Opposition, and at the next a P.P.S. [Interruption.] I do not sit on both sides.

The Deputy-Chairman: I do not think there is anything in the Amendment about P.P.S's.

Sir H. Williams: The Financial Secretary says it will be most inconvenient to put a time limit in the Bill. I wish he had time to look at some of the Statutes. He would find dozens with a time limit. Sometimes it goes so far as to say "This Act shall last for five years and no longer," but that does not prohibit its inclusion in the Expiring Laws Continuance Act. You do not need a one-Clause Bill. It is much simpler than that—one line in the Schedule to the Expiring Laws Act. There is no difficulty and no discussion as a rule, unless for some reason there is opposition to the continuance of an Act. Local authorities will still be free to go to the Public Works Loans Commissioners if the Amendment is carried, and the five years have expired. I think the Minister ought to read the whole Bill and not merely the one Clause to which the Amendment that has been proposed relates. The idea expounded with vigour and eloquence and more heat than light by the hon. Member for West Fife (Mr. Gallacher) that the Amendment is for the purpose of protecting the money of the corporations is completely remote. The sole object of the Amendment is to ensure that at the end of the five years the local authorities will not be prejudiced.

Mr. Gallacher: Is it not the case that it is to allow members of a reactionary local authority, who are associated through their families, directly or indirectly, with financiers who are prepared to provide loans at high rates of interest to take a decision to get a loan? Can the hon. Member tell me that he knows of particular philanthropic institutions which are anxious to supply local authorities with money for nothing, or at a low rate of interest?

3.15 p.m.

Sir H. Williams: I am not suggesting that. I do not belong to what he described as the money-grabbing fraternity and I have never had any connection with lenders of money. I happen to know, however, that a very large number of institutions would, for a variety of reasons, be only too pleased to lend large sums of money, not for long periods but for substantial periods, at rates of interest which are half what is contained in the proposals of the Bill. Therefore, the object which is behind those who are criticising the Bill is to enable people to borrow more cheaply. Of course, the hon. Member for West Fife, who is a great student of other countries, is an expert on rates of interest, and he ought to realise that in the country he admires most the Government's rate of interest is 4 per cent. tax free, equivalent in our case to 8 per cent., as compared with the 3 per cent. at which money is borrowed in this country. When he has cleared up that situation and had more experience, he will be able to advise us how money can be borrowed economically.
I have heard no argument why the Amendment should not be made. It will hamper nobody and the Government will be able to continue the operation of the Bill by one line in the Schedule to the Expiring Laws Bill. As there are a large number of people who are dubious about the Bill as a whole, and certainly about its indefinite continuance, why cannot the Government relieve their anxieties? It will not prejudice the Government and it will not make it possible for any future Chancellor to be charged with breaking a pledge to which he was not a party.
I would ask the Financial Secretary to send for the Chancellor. It is clear that he himself has no authority to accept the Amendment because he did not give a

clear and simple answer to the question asked by the hon. Member for Colchester (Mr. Lewis). It is monstrous that the Committee should have to discuss a Bill without the presence of the Minister who alone is able to respond to the arguments, and it is discourteous of the Chancellor not to be here. We know the position of the Financial Secretary; he has his brief and he cannot depart from it without further authority from the Chancellor. I hope, therefore, that if the Chancellor does not turn up when we have finished discussing the Amendment, the Chairman will accept a Motion to report Progress.

Lieut.-Commander Joynson-Hicks: I have not hitherto intervened in the Debate, although I am in favour of the Amendment. There are two matters arising out of the speech of the Financial Secretary which further convince me that the Amendment is correct. We are becoming accustomed to being governed by legislation by regulation, by order and by rule. It is solemnly proposed to-day that we should be governed by legislation by Ministerial assurance, and I feel that my right hon. Friend is put in a false position in having to ask the Committee to accept such a situation. For any Minister to have to back up a Bill in Parliament by asking that Members should rely upon an assurance instead of a straightforward Amendment saddles him with a responsibility which any Minister should be glad to avoid.
The other point about which I feel strongly is that, if my right hon. Friend's argument is carried to its logical conclusion, this is a simple and straightforward bargain between the local authorities and the Treasury with which the Committee is expected to have no concern at all. Because local authorities are satisfied with the assurance which has been offered to them, hon. Members are asked to accept that position and not participate in the consideration of the Measure in any way. I do not feel that that is a correct or proper proceeding. I can see no reason why objection should be taken to the insertion of a time limit. It does not override the assurance that has been given. The Chancellor of the day will still be in a position to review the situation, and will, I imagine, be expected to do so, at the expiration of five years. He will have one year following his review


before the provisions of the Bill expire. That will give him ample time to consider what steps may be necessary at the expiration of the fifth year when the Bill comes to an end. That procedure is both beneficial and simple, and it is only right and proper that the Committee should ask the Government to accept it in preference to relying upon a Ministerial assurance.

Mr. Benson: I agree with the hon. Member for South Croydon (Sir H. Williams) when he suggested that the Financial Secretary's speech was not quite up to his usual standard. The right hon. Gentleman did talk an awful lot of nonsense. He suggested that, if the Amendment were made and the Bill were limited to five years, as the five years approached their end local authorities would be thrown into chaos in their borrowing relations inasmuch as they would rush in to borrow while money was cheap. That suggestion will not stand examination for a moment. There would still be the Local Loans Fund and the power to borrow there.

Mr. Peake: I really must make it clear that, if Clause 1 of the Bill lapses, the scheme of lending to local authorities at the cheap rates which I announced on Second Reading will also go.

Mr. Benson: Cheap rates will not go unless the Government will it by regulation. In spite of what I have said, I must say that the arguments of the Financial Secretary are a good deal better than those in favour of the Amendment. The amount of heat that has been generated in this matter is extraordinary, because what does the Amendment really mean? It really means that we have pinned out a claim for another Debate on this subject five years hence.

Mr. Colegate: It means far more than staking out a claim for a Debate. It means staking out a claim for the whole of the local authorities that they should not have their financial powers temporarily suspended. That is a much bigger claim.

Mr. Benson: The hon. Gentleman knows perfectly well that, if the Government of the day decide that the Bill should be continued after five years—unless they are defeated on it, which is not likely on a Bill of this kind—it can easily be continued. We have had a pledge that the matter will be considered in four years' time, and we shall get our Debate on that.

Sir J. Lamb: The pledge was that the Chancellor would consult the local authorities, not that we should have a Debate on it.

Mr. Benson: I agree, but the House can get a Debate on this subject any time it feels strongly enough about it. The Amendment merely means that we shall have a Debate five years hence. If the Government think the time has come for the Act to lapse, it will lapse. If the Government do not think so it will not lapse. So the practical effect of carrying the Amendment will be nil.

Mr. Lewis: The Financial Secretary to the Treasury, in response to my challenge, was unable to assure the Committee that he had any authority from the Chancellor to exercise his own judgment whether to accept the Amendment or not after having heard the arguments. There is no one on the Front Bench at this moment who has that authority. The position is that the Financial Secretary is sent to us to-day as a very ornamental and charming rubber stamp. He is to issue the orders of the Chancellor to the Committee, orders issued by him before the Debate has taken place. The Chancellor has no objection to our putting Amendments on the Paper and to our making up arguments in support of them so long as he has not to trouble to listen to them and is not obliged to pay any attention to them. That is treating the Committee with the greatest discourtesy, and I am astonished that any Members of the Committee outside the Government, whether they agree with the Amendment or not, are willing to put up with that treatment.

Sir J. Mellor: In order that the Chancellor may have time in which to be informed of the arguments which have been adduced during this Debate, may I again ask leave to move to report Progress?

The Chairman (Major Milner): I cannot accept that Motion. The hon. Member has not advanced any adequate ground in support of it.

Sir J. Mellor: The arguments were indicated by my hon. Friend the Member for Colchester (Mr. Lewis). The Financial Secretary has listened very politely to our arguments, but he did not come with any authority from the Chancellor to accept the Amendment if he was impressed by the arguments in support of it. The Chancellor of the Exchequer has just come


into the Chamber. It is obviously not possible, in the course of a few whispered comments between him and the Financial Secretary, for the Chancellor to be fully seized of all the arguments which have been advanced in support of the Amendment. I therefore respectfully submit that there are the strongest grounds for reporting Progress.

The Chairman: I cannot accept the Motion. The matter was put to my predecessor only ten minutes or so ago, and I also can see no grounds for it.

Sir J. Mellor: Your predecessor, Major Milner, said that he could not accept it at that stage, and I submit—

The Chairman: The hon. Gentleman is not entitled to argue about my decision.

Mr. Butcher: Very properly, in the exercise of your discretion, Major Milner, you have not accepted the Motion to report Progress. Will you give a Ruling whether we shall be guilty of any breach of the repetition rule if we repeat the arguments so that the Chancellor might be fully informed of the views we hold?

The Chairman: I should think it highly probable.

The Chancellor of the Exchequer (Sir John Anderson): I am sure the Committee will realise that I am always at its service. I am only sorry that I was not here a little earlier—but I was prevented from being here earlier—to listen to the arguments that have been put forward. I understand that the issue which has been raised is one which attracted attention on Second Reading. The question of a time limit is really, from my point of view, not a matter of principle so much as a matter of convenience. I do not desire, as I think I made clear on Second Reading that these special arrangements, which I think it is generally agreed are, in existing circumstances, to the general advantage, should be continued longer than is necessary.
3.30 p.m.
The difficulty about the time limit is the difficulty we are in, in present circumstances, of not knowing exactly the significance of the time factor. We do not, in fact, know for how long these admittedly special arrangements, which are not designed as a permanent change in our

methods of finance, will really be justified. I did think, and I say so quite frankly, having taken those who were directly concerned with this matter, the Associations of Local Authorities, most fully into consultation before the preparation of this Bill, that the absence of a time limit, in view of the assurances that had been given to those Associations and which have been repeated in this House, did not occasion any disquiet. But it is also the case that I have, unfortunately, not been able to be present to hear and weigh up all the arguments that have been put forward. I have said that it is not a matter of vital principle from the point of the Government, and if the Committee would like me to undertake to consider the arguments that have been put forward, I am naturally perfectly willing to do so should the hon. Member, in the interests of the progress of this essential Bill, agree to withdraw his Amendment.

Sir H. Williams: Do I understand from that that the Chancellor means that the Third Reading will not be taken to-day?

Sir J. Anderson: indicated assent.

Sir H. Williams: I will ask the Chancellor to consider then that continuity could be effective by the simple device of the Expiring Laws Continuance Bill, and when I look at the kind of Acts that are continued by that Measure this seems to me just the type to be dealt with in that fashion.

Mr. Douglas: If the Chancellor of the Exchequer wishes to take cognisance of the view expressed, I would respectfully suggest that it could be done very simply by making the duration of the regulations, which are the effective instrument under Clause 1, four years and then he could consider, at the end of that time, whether they should be renewed or not.

Sir J. Mellor: In view of the promise which the Chancellor of the Exchequer has given to consider this matter between now and the Report stage, I beg to ask leave to withdraw the Amendment.
Amendment, by leave, withdrawn.

Mr. Colegate: I beg to move, in page 1, line 8, at end, insert:
except in cases where borrowing could be effective on more advantageous terms than those offered by the Commissioners.


I wish to make clear to the Committee that this Amendment does not conflict in any way with the purposes of the Bill, but raises a very important point for the local authorities and is one on which I agree with them. It is true that under the scheme proposed by the Bill, local authorities will be able to borrow cheaper money and we are all in favour of that, but before I deal with that, I wish to clear away two misunderstandings which appear to have arisen and were mentioned by the hon. and gallant Member for Stafford (Captain Thorneycroft) a little earlier. Some people seem to have thought that an Amendment of this kind—and it was hinted at on the Second Reading—would affect the orderly approach to the capital market. I can assure Members that if they will read the Bill they will find that this is not the case at all. I am 100 per cent. in favour of an orderly approach to the capital market. That is in operation at the present time, but there is nothing about it in this Bill. That is purely for the Capital Issues Committee. Let me read the words of the Financial Secretary, who said:
There will be the Capital Issues Committee which will be concerned with the quite different and very important question of priorities."—[OFFICIAL REPORT, 2nd February, 1945, Vol. 407, c. 1786.]
He went on to say that these priorities would be the subject of a full review by the Capital Issues Committee. Therefore if this Amendment is adopted, it will not affect, in any way whatever, the orderly approach to the capital market, because that is going to be settled by the Capital Issues Committee.
It has been rather implied that the local authorities are wholly in agreement with the Chancellor of the Exchequer on this Bill. In a strictly theoretical sense, it is true, but it is not quite true in the practical sense, because what happened was that when the representatives of the local authorities met the Chancellor of the Exchequer on 19th July last, there had been some difference of opinion. The executive of the Rural District Councils Association had passed a resolution that, in their opinion, local authorities should retain the right to borrow loans otherwise than from the Public Loans Board, provided that the rate of interest did not exceed the rate of interest for the time being charged by the Board. Some other authorities were not in agreement with

that but their point of view was not put forward. The Chancellor of the Exchequer of course met the executives of these different local authorities' associations, and since that time and since the view of the Rural District Councils Association has become known, many county councils and others have changed their view and many Members have received letters from their local authorities objecting to this. Therefore I do not want the Committee to run away with the idea that all the local authorities are complely in agreement with this Bill. I think if it were put now to the local authorities practically every local authority would vote in favour of the Amendment which I am pressing on the Chancellor's attention.
Let me deal with this point. What is the effect of this Amendment? It has two effects, one moral and the other practical. I do not want to repeat myself but I did raise it on a previous Amendment. What we have to realise for the moment is that in this enormous task we must do everything we can to raise the prestige of the local authority in such a way as to attract the very best type of men and women, whose services are so vital. That is one effect—to preserve the rights and the prestige of the local authorities. Now let us turn to the practical effect. It was put neatly by the hon. Member for North Tottenham (Mr. R. C. Morrison) in this way: If they cannot borrow more advantageously, why prohibit them from doing something which it is impossible for them to do? On the other hand, it is clear from the fact that resistance has been shown to the principle advanced, that the Government think that some local authorities could borrow more advantageously than from the Public Works Loan Board.
Let me deal first of all with the word "advantageous." I would ask hon. Members to realise what I mean by it. I do not mean "cheaper," for it is quite true that if you merely use the word "cheaper" you could bring up a case which would be very disadvantageous. I give an example. Suppose a local authority wishes to borrow for 40 years in connection with a long-term project, at the end of which time the project would probably have self liquidated. Then you come along and say: "Let us go to the borrowing market and borrow money at 1⅛ per cent., and at the end of three


months you will renew, and so on for 40 years." That is an extremely dangerous gamble. It is very imprudent, and it would not be advantageous because it is a bad thing that long-term projects should be financed by short-term loans, except in very exceptional circumstances. That is why I used the word "advantageous" and not "cheaper" and that is why I am drawing the Chancellor's attention to this point, because if this Clause is amended, as I desire, it would be the Treasury, and to some extent the Capital Issues Committee, which would be deciding what was more advantageous. I would not suggest for a moment that if a local authority is going to borrow imprudently or cheaply, it should be allowed to do so, but I think that the use of the word "advantageous" makes it clear that the Treasury will have ample opportunity of viewing the proposed financial operation as a whole, and then deciding whether or not it would be advantageous.

Sir Frank Sanderson: If there is any agreement with the example that we have just been given, would it not in fact not be "disadvantageous" but rather "inexpedient?"

Mr. Colegate: I will not quarrel with the word "inexpedient" and I will not go into dictionary-making with the hon. Member. If the Chancellor of the Exchequer likes another word—and I hope to find him in a more yielding mood—I am sure we shall be able to agree to that word.
Let us get down to the facts. If we do not take these rights away from the local authorities, we shall not be weakening the general scheme. On the other hand, there is this to be argued. There might be times when the Government would not be able to borrow on such cheap terms as other organisations. In the past, we have had both. Tory and Liberal Governments, who have mismanaged their finances and who have had to borrow at much higher rates than they would otherwise have done. It is by no means certain that it is always going to be possible for the central Government to be able to borrow more cheaply than the local authorities. It was not true in 1930. Then, several of the well managed local authorities of this country were borrowing much cheaper than the Central Government, and especially central Govvernment

authorities. An electricity board was borrowing in 1930 at 5½ per cent., yet I know that there were local authorities who were borrowing at 2¾ and 3 per cent. I think as a safeguard we ought to preserve this right, and I do press this Amendment most strongly on the Government. It can do no harm whatever to their scheme. On the other hand, it will preserve the rights which the local authorities value very deeply and it might at one day and at some time be of very great practical importance to them.

3.45 p.m.

Mr. Douglas: The hon. Member for The Wrekin (Mr. Colegate) has, by his speech, completely destroyed the Amendment. In the first place, I do not know how anyone is to interpret the word "advantageous." He himself explained that mere cheapness is not necessarily advantageous, and it seems that whoever would have to make the decision upon this matter, if this Amendment were carried, would have to do so on imponderable considerations which would be very difficult to explain or to defend. Secondly, he has said that he approves of the principle of an orderly approach to the capital market in the circumstances with which we shall be faced immediately succeeding the war. I think everybody must realise the importance of that, in view of the conflicting demands which will be made for very urgent and necessary capital expenditure. If that is so the admission of this exception would cause very serious difficulties indeed.
It is not true that the Capital Issues Committee will control all borrowing by local authorities so long, at any rate, as the Capital Issues Committee continues to function on the principle on which it now operates, namely, that it is not concerned with the borrowing of sums below £10,000. A very large number of these local authority borrowings will be sums less than £10,000 and will not be the concern of the Capital Issues Committee as individual transactions. Therefore, if this Amendment is carried, they will not be canalised through the medium of the Public Works Loan Board, and there will be a multitude of individual transactions taking place, in regard to which it will not only be difficult to determine whether they are individually advantageous or not, but still more difficult to determine


whether in total, and in their cumulative effect, they are influencing the capital market in a manner which is disadvantageous both to the local authorities themselves and to the Government, as a borrower of money. I hope that on both these grounds the Chancellor of the Exchequer will not accept this Amendment.

Mr. Spearman: I am sorry to find myself differing from my hon. Friend the Member for The Wrekin (Mr. Colegate), as I am so often in agreement with his views, but I do not think this Amendment would be either fair to the Treasury or, in the long run, favourable to the local authorities. My hon. Friend made rather a point about the Capital Issues Committee being the regulator of new issues and thereby avoiding any fear of a scramble for loans. I can assure him that long before the war it was not possible for local authorities to borrow without permission from the Bank of England, who had a list on which the authorities had to queue up. I can remember going on many occasions to the authorities on behalf of local authorities, to ask for permission, and being told "I am afraid you must wait some weeks," or, in some cases, for some months. In spite of that, although that course certainly ameliorated difficulties, it did not dispose of them. There was very severe congestion in the market, which led to indigestion among the consumers, that is the lenders.

Mr. Colegate: I, too, can remember queueing up at the Bank of England for a very large amount, but my hon. Friend's argument is leaving out of account that it was only in regard to certain classes of issues that the Bank of England had a say. The Capital Issues Committee covers the whole field—Government, private or local authorities.

Mr. Spearman: I quite agree that I was only referring to public issues, but about half the total borrowings of corporations was in the form of public issues. In spite of the orderly method then arranged we did see a scramble for issues, with a bad effect on the money market. My hon. Friend also referred to the very favourable terms on which it was possible for corporations to borrow by means of bills. I am sure he is aware that that was not an option they did exercise to any extent. The total borrowings of local authorities amount to about £1,700,000,000 and the

amount in bills is about £1,500,000, that is less than one-tenth of one per cent. I think my hon. Friend is getting that aspect a little out of proportion.

Mr. Colegate: I said that I did not want local authorities to borrow by means of bills. I said they must make long-term loans for long-term projects.

Mr. Spearman: I am very glad to hear that. As to the position in general, I believe that the rates announced last week by the Financial Secretary are very favourable to local authorities. I have made a good many inquiries, and I am satisfied that on balance the rates offered are a little cheaper than what the local authorities could get in the open market. What I think my hon. Friend is really asking for in this Amendment is an option for the local authorities. It is proposed that a local authority, under the protection provided by a firm offer from the Treasury, should be able to go round the market and try to squeeze a fraction of 1 per cent. advantage; that would mean a maximum of disturbance with a minimum of achievement. I would suggest that the real concern of local authorities is not whether they can borrow at 2⅞ per cent. or at 2 per cent., but whether they are to borrow at the current rate, or, as after the last war, to borrow at 5, 6 or 7 per cent. That is what matters. I consider that this Measure is of assistance in achieving low rates of interest. I do not want to exaggerate it. I do not think it is a very important weapon in the Treasury's armoury towards achieving low rates of interest, but I think it is a useful weapon. Therefore, I agree that, in the long run, it will benefit not merely the Treasury, but the local authorities themselves. That is why I support it.

Mr. David Eccles: I wish to support the Amendment. I am curious to hear what the Financial Secretary or the Chancellor has to say which will prove that the Amendment is no good, because in the Financial Secretary's speech when he wound up the Second Reading Debate on this Bill he advanced an argument against allowing the local authorities to borrow outside the Whitehall bank which has no effect upon this Amendment. He said:
We do not want them to go elsewhere. There must be some advantage for the Treasury, as well as for local authorities, in this scheme. We do not want foolish and


unwise borrowers to go into the market, and spoil it for everybody else, by offering something substantially in excess of these rates."—[OFFICIAL REPORT, 2nd February, 1945; Vol. 407, c. 1788–9.]
The voice of monopoly sounds very sweet in the mouth of a Minister of the Crown. That is what my right hon. Friend is asking for—a monopoly. What is the advantage of this monopoly? If it is a public advantage, we should be in favour of it, but we must know what the advantage is. This Amendment will not mean competition in interest rates, which was the only point dealt with in that speech of the right hon. Gentleman, because local authorities, under this Amendment, only seek to borrow more cheaply than at the Treasury rate.

Mr. Spearman: Would my hon. Friend be in favour of withdrawing the promise the Government have given to lend to them at current rates of Government stock? That is a pretty valuable thing which the Government have offered.

Mr. Eccles: I am certainly in favour of that Government offer.

Mr. Spearman: My hon. Friend wants an option against the Government for nothing.

Mr. Eccles: I certainly want an option against the Government, for this reason, that what the Treasury are afraid of is the shortage of savings after the war in relation to the demand for those savings for the whole list of reconstruction projects. They have gone on to say "As savings will not be sufficient in quantity let them all be canalised through the Whitehall bank. In that way we shall collect the greatest quantity, and we shall parcel that quantity out in the fairest way." If that is the Treasury argument it is a bad argument. All our experience shows that when there is a real stringency in one of the factors of production, the best thing is to rope in everybody who can lend a hand, and not to create a monopoly. If the Committee will consider the man-power shortage in the war, how should we have fared without the voluntary services and part-time work given by thousands of women and some men who were not within the net of the Minister of Labour and National Service and the employment exchanges? If the Committee considers the finance of the war, it has been right to have Red Cross collections.

If charitable subscriptions had not paid for prisoner-of-war parcels, the taxpayer would have had to pay. We see from our war experience that when things are very short it is worth while in a country like England—

Mr. Messer: Is it not the taxpayer who contributes to these things?

Mr. Eccles: My whole point is that by continuing a system of voluntary payments we have managed to get more money, in a better and more satisfactory way, than if the whole of the Red Cross activities had been financed out of the taxpayers' money. I see so much danger in the shortage of savings after the war that I do not wish to lay aside any method that we may be able to use to attract what may be even—

Mr. Spearman: My hon. Friend is not proposing anything that will increase the number of resources of lenders, but is proposing to create competition among the borrowers.

Mr. Eccles: There are people who prefer to lend money at very low rates of interest to their local authority who do not want to lend it to my right hon. Friend's monopolistic bank in Whitehall. Some of us care more about things that are near to our homes than we do about central government.

Sir F. Sanderson: Can the hon. Gentleman give a single instance in which a local authority has been able to borrow money at less than the rate of the Government credit?

Mr. Eccles: I cannot at the moment give the hon. Member an instance, but as an illustration of my argument may I refer to a firm of well-known engineers in Chippenham who are, at this moment, trying to find ways and means of making a substantial donation to a youth hostel in the town, which they certainly would not do if it was in a town in the North of England? They wish to do it because Chippenham is their town. There are people who lend money for other reasons than interest. It is to give these people a chance that we ought to support this Amendment. I hope it will be accepted as an exception which proves the excellent rule that the Bill is designed to bring into practice.

4.0 p.m.

Mr. Peake: It may be for the general convenience if I state shortly the Government's attitude to this Amendment straight away. Unlike the previous Amendment, which dealt with a matter of expediency, the present Amendment goes to the root of the principle of the Bill. As the hon. Member for Scarborough (Mr. Spearman) pointed out, the Bill has advantages for the local authorities and for the Treasury. It is a balanced Measure. Local authority borrowing is to be canalised, through a central channel, for the convenience not only of local authorities but of His Majesty's Government. On the other hand, local authorities are to get money at the very low rates which I announced in winding up the Debate on the Second Reading, that is to say, at rates varying from 2 per cent. for five-year loans to 3⅛ per cent. for loans as long as 80 years.
That being the case, and there being an advantage in the Bill for each party, it is quite unwarrantable to give to local authorities an option which operates only in their favour. It would be absurd on the one hand to give them the benefit of being able to borrow at what are, in effect, purely Government rates of interest, and at the same time to tell them that they can, if they are so pleased, and can make out a case for something which they think is more to their advantage, go elsewhere. In the case of the quixotic lender, of which I think the hon. Member for West Fife (Mr. Gallacher) is an example because he told us that when he lends money he never charges anything for it, or the Andrew Carnegie of the future who, out of sentiment for his home town, wants to lend them £100,000 without charge, we shall make an exception under Clause 1; but it would be quite unreasonable to give the local authorities an opportunity of borrowing money at Government rates and to say to them, at the same time, that they can hawk round the market and try to pick up any loose money that happens to be there on terms more advantageous than the terms offered by the Public Works Loan Board.
Apart from cutting across the basic principle of the Bill the Amendment would he quite unworkable, because it does not establish any definite criterion. It is not a question of whether money can be obtained more cheaply elsewhere, but of whether the terms are more or less

advantageous. Stockbrokers and stockjobbers in the City of London are spending their whole days trying to decide what is, or what is not, more or legs advantageous to their clients. It is a matter purely of opinion. My hon. Friend's Amendment establishes no body of persons who are to judge whether or not a particular course is or is not more advantageous.

Mr. Colegate: There is power to make Regulations on a matter of this kind. It is not so mysterious as all that. The same is true of the rate of interest and the period of the loan.

Mr. Peake: As I have pointed out, apart from cutting across the basic principle of the Bill, the Amendment has not, in my opinion, been thoroughly considered. It establishes a criterion which is a matter of pure opinion, and it does not set up any authority to decide whether one opinion or the other is correct. My hon. Friend referred, as an example of bad and expensive Government borrowing in the past, to the case of the Central Electricity Board. That is not a case of Government borrowing. The Central Electricity Board did not even have a Treasury guarantee. It had no concern whatever with borrowing by His Majesty's Government. For the reasons which I have stated, the Amendment is unacceptable.

Mr. Bowles: May I ask one question? Would it not be good to refer to the history of local government borrowing and to remind the Committee of a certain local authority which borrowed from Mr. Clarence Hatry?

Mr. Peake: I was not intending to do that. I was proposing to leave that to my hon. Friend, if he had the opportunity to participate in the Debate. We cannot accept the Amendment, which goes to the very root of our proposals, and I would ask either that my hon. Friend should withdraw it or that the Committee should reject it.

Rear-Admiral Beamish: I intended to make a short speech but I have decided not to do so. I want, however, to ask a question about the words "without the approval of the Treasury." Can the Minister give some sort of undertaking that the approval of the Treasury would not be unreasonably withheld; or has it


to be understood that "without the approval of the Treasury" means effectively that no local authority can ever borrow without it?

Mr. Peake: In the Second Reading Debate, my right hon. Friend explained in great detail what the regulations under Clause 1 would contain. There are substantial exceptions to the general prohibition imposed by Clause 1. As regards particular exceptions covered by the words "without the approval of the Treasury," of course I can give my hon. and gallant Friend an assurance that that approval will not be unreasonably with-held.

Mr. Wootton-Davies: I, too, wanted to say something in this Debate, but will content myself by drawing the attention of my right hon. Friend to the finances of one local authority. We have been talking about interest rates and how municipalities and commercial firms can borrow more cheaply than the Government. Over a long period of years the Lancashire cotton industry was financed by loans much more cheaply than it could borrow from the market. The point has also been raised about municipalities borrowing money at rates cheaper than market rates. The West Lancashire Rural District Council was able to do so, because Lord Sefton lent us £50,000 for 40 years at 2½ per cent., when the Government were paying between 5 per cent. and 6 per cent.

Lieut.-Colonel Dower: I want a little enlightenment on one or two points, because the local authorities in my part of the country are very concerned about this matter. I have heard some people suggest that local authorities are not concerned about it, but they are. I have letters here to prove it. I want to see that my local authority are fully enlightened upon the Government's intentions. It is my intention definitely, whether the Amendment is pressed or not, to enlighten them as to the effects of the Bill. I am not setting myself up as having any special knowledge, but I want information. The first point is whether the interest charged by the Board will be at a fixed percentage, or whether they can increase it. If the latter is the case, the whole argument in favour of the Board

having the exclusive right seems to fall to the ground. Now for the second point. I have read the previous Debate. I was not here when it took place and I apologise, but I read it very carefully. My right hon. Friend seemed to say, in column 1788 of HANSARD, that local authorities will not be able to borrow on lower terms than those to be fixed by the Board. That is a very definite statement. I do not want to press the point unduly, but my right hon. Friend should make it perfectly clear whether he stands by that statement or whether it was a natural slip.
I do not wish to be unfair, but local authorities might be able to borrow at various times at a lower rate than the Board has fixed, not through unusual circumstances, or through going to Mr. Clarence Hatry, or anything like that. I want to know whether my right hon. Friend thinks that at any time the local authorities would be able to go to a reputable source and borrow money at a lower rate than the Board will fix. There must come a time when this country will get sick of all these powers at the centre. My hon. Friends on these benches will find that at the election a great many of their supporters will not be in favour of all-powerful executives and officials. If they concentrate more on improving social legislation they will get more support than by giving power to Ministers and officials.

Mr. Bowles: In reply to my hon. and gallant Friend the Member for Penrith (Lieut.-Colonel Dower), may I say that on this question of controls the position of my hon. Friends is quite clear? We do not like controls, but we find them necessary to curb the avarice of private enterprise and private lending. In this Bill, for the first time for some years, the Government say, with a full sense of responsibility, "We are gong to see that the Public Works Loan Commissioners really carry out their public duty of seeing that the best possible terms are available for local authorities who want to borrow money." We have had examples of what happened where this prohibition against their going wild did not exist. I would refer to the case of Hatry, in which we found the Gloucester Corporation, the Newcastle-on-Tyne Corporation, and others all borrowing the same money from the same man, and it was only because he was not able to get enough share


certificates ready that he was "rumbled." I am not blaming him, but I am blaming the lack of inquiry which was made by the local authorities. This matter must appeal to us, who are concerned with the public welfare first, and we shall be vigilant to see that the Public Works Loan Commissioners properly carry out their duty of seeing that local authorities get money advanced to them on the most advantageous terms.

Lieut.-Commander Joynson-Hicks: I am sorry that the Financial Secretary intervened when he did, and I ask him to intervene again, in order to reply to a question which I asked on the Second Reading. It is a small point, as to whether those "over-the-counter," or "cash-and-carry" loans, which are made by ratepayers to local authorities in small amounts will come within the exceptions whereby local authorities may borrow outside the Public Works Loan Board. It is a small point, but one of considerable importance to local authorities and people, and one which would obviously fall within the terms of this Amendment. I cannot refrain from commenting upon the monopolistic attitude of the Government in this Debate. They not only insist on a complete monopoly for lending money to local authorities, but they claim a monopoly in financial matters, to the exclusion of everybody else, in every direction.
They make the matter very mysterious, but I cannot see where the mystery lies. On the Second Reading the Financial Secretary said that they did not want local authorities to go elsewhere; but why not? I suggest that the elimination of local authorities from the market will remove a very valuable buffer for the community as a whole, and that it will upset and differentiate against industry. If the Government are satisfied that they can lend at low rates, why should they object to having the check imposed upon them which the opportunity of going to the open market will create? I can see no possible objection to that, and I do not see why the Financial Secretary should be so loath to tell us his reasons. I regret very strongly that he will not consider this Amendment, and I ask him to reply to that one minor point of mine.

4.15 p.m.

Mr. Woodburn: I did not intend to intervene, but the argument which has just been put forward, and which has been

advanced before, is very plausible. I think there is a good reason why there should be this financial bottleneck, so to speak, in the case of municipal loans. There is a definite reason for resisting the temptation to allow municipalities to seek cheaper money. Whether that is practicable or not I do not know—I doubt it when I see the interest rates which are mentioned. Some years ago, under the Empire Marketing Board, the farmers and the business men of the Hebrides were given a good marketing scheme. Up to then, they had obtained 9d. a dozen for eggs, but when they were able to form a co-operative marketing scheme the Board were able to offer them 1s. a dozen. Along came the private merchant, and he began to offer this little farmer and that little farmer 1s. 3d. per dozen. So many of the farmers and the farm wives took advantage of that offer that the marketing scheme collapsed, and they were soon back to 9d. or 8d. a dozen. There is a possibility that some financial interests would resent the Government's rates of interest, and would offer an inducement to the local authorities to break away from the co-operative scheme by offering lower rates of interest. That might break down the effort of the Government to provide low rates of interest.

Mr. Colegate: How would it break up the system? It seems to me that it would support it.

Mr. Woodburn: Either the system works, with the local authorities being controlled, or the whole thing is burst up by their being scattered right and left, hunting for money elsewhere. Unless we control the scramble for money we cannot control the interest ring.

Mr. Colegate: Interest is not controlled by this Bill: it is done by competition.

Mr. Woodburn: We have seen what competition for money rates can do. Some local authorities are paying 6 or 7 per cent. for loans because of that system in the past. We can understand that certain financial interests will not like this scheme, because it is going to interfere with what is called—

Mr. Colegate: It has nothing to do with financial interests. I spoke about a resolution passed by the Rural District Councils' Association.

Mr. Woodburn: Even foolish local authorities have to be protected against themselves.

Mr. Colegate: Is that local government and democracy?

Mr. Woodburn: Are they, like the egg wives of the Highlands, to run after everyone who comes along, like a donkey with a carrot in front of his nose? If so, they may destroy the scheme that is there for their benefit. Parliament has to protect not only the local authorities but the people who want houses and those who have to pay the taxes. It is not only the local authorities that are involved, because the great finance to which the hon. Gentleman refers and for which the local authorities will come to the Government is finance for houses. These houses will not be built without considerable subsidies from the Government, which has a direct interest in seeing that the local authorities are not fleeced. I can see no reason why, when that discretion lies in the Treasury, they will go out of their way to make local authorities pay more interest, the burden of which may fall on the Chancellor of the Exchequer himself if he allowed that to happen.
I would like an assurance from the Chancellor or the Financial Secretary that, in the cases where people deposit money with local authorities for convenience, this practice is not barred out under this scheme. I understand that that was what the hon. Member for The Wrekin (Mr. Colegate) referred to in his Second Reading speech—that firms deposited money with local authorities at very low rates of interest. I understood that this will not be ruled out by this Bill. I am also interested in municipal banks, and I had an assurance from the Financial Secretary on Second Reading, but if he has any further statement to make which will give an assurance that these banks are not to be destroyed, or prevented from using local authority money, I shall be very glad to hear from him.

Mr. Loftus: I rise only on account of a remark made by my hon. Friend who has just spoken. He referred to certain municipalities owing loans at 7 or 7½ per cent. and he said that was due to the scramble for money. I say that it was not due to that cause, but to the deliberate policy of the financial authorities in this country, the Treasury and the

Bank of England, in deflating and raising interest rates until they got the Bank Rate up to 7 per cent., when all interest rates rose. We know that the late Sir Kingsley Wood pledged the Government, and we do not doubt that the pledge will be honoured, to maintain low interest rates after the war, but suppose a future Government resolved, as did the Government after the last war, to enter upon a policy of deflation and deliberately raise interest rates, as has been done before. Suppose, then, that a local authority appeals to the patriotism of its people and says: "We cannot finance houses, and we appeal to the local people to subscribe their money at very low rates of interest." What would happen? Would the Government policy be to encourage that sort of thing?

Mr. Messer: I would not have intervened but for the remarks of the hon. Member for The Wrekin (Mr. Colegate). I have been listening to the Debate and I think the hon. Member's constituency really ought to be pronounced "wrecking."

Mr. Colegate: That is a very old joke, and is not allowed in my constituency. It was banned 10 years ago.

Mr. Messer: The hon. Member said that hon. Members on these benches were opposed to local government. No more absurd statement has ever been made in this House. They realise quite well that the administration of our social services is largely in the hands of local government, and no one could find any people more interested in that administration. What would my hon. Friend's Amendment do? I am speaking as a member of a local authority. We cannot look at this thing from the aspect of one local authority, but have to look at it nationally. If the Government are to carry this thing through properly, they must look at the country as a whole and not allow one local authority to wreck their plan for finance. The short answer is this. We have too long been the victims of disordered finance. There are special circumstances at times which make it possible to borrow at low rates of interest, but, unless this borrowing can be controlled, it is very easy for that low rate of interest to make it impossible for the scheme to work.
I submit, therefore, that the Amendment is very specious. Superficially, it looks good, but we must look at it in the interests of the people as a whole and in the interests of public lending, and I submit that anybody with any public experience at all will agree that what we are wanting is a sound system of finance, not just cheap money at one time to give power that can be used at a later period to increase rates of interest, but an equally recognisable foreseeable period in which one could know what money could be had and could proceed with the work. The anarchy that would result from acceptance of this Amendment would destroy the Government's plan.

Mr. Evelyn Walkden: I am tempted, in re-reading the Amendment, to answer the hon. Member for The Wrekin (Mr. Colegate) when he accuses us of being anti-local government in our attitude. Those of us who come from ordinary, humble homesteads and have been associated with the local government and well-being of our towns and villages, and with social improvement and development generally, which we have helped to provide, know of the vast mass of experience which has been accumulated and shared with this House. We have given encouragement to many others, who will eventually, possibly, dispossess the hon. Member for The Wrekin of his seat by reason of the knowledge that they will be able to display to the electors at the next election. What we are concerned with is his encouragement of the belief that local authorities will benefit by this Amendment, because they may go into a cheap market. We have had experience of that too, and our experience has been along the lines of the small shops and the big multiple firms. The multiple firms offer goods at low rates at the start, but eventually, when they have gobbled up the little shops, prices go up.

The Deputy-Chairman: This is really too much for me, as it is far beyond the Amendment.

Mr. Walkden: I am trying to show to my hon. Friends how economics work and how this theory actually crushes our people. We believe that the same principles that apply in cases where multiple firms blot out the little man will also apply here to local authorities. For a time there may be cheap money, for a time the local

authority will be encouraged to borrow from what they call the free market, but, eventually, it will be discovered that the objective is to wreck the Government's scheme and to force up prices. The price of money will undoubtedly rise as a consequence of this Amendment if it is carried.

Lieut.-Colonel Dower: Surely if that state of affairs occurred, the local authorities would be able to lend money on very generous terms to the Board?

Mr. Walkden: We are concerned with making the scheme secure, safe and sound for the local authorities so that they can estimate exactly at what rate they can get money, and what they can do with it, and precisely what it will cost the citizen. The Amendment leads us in the direction of the position which arose after the last war. Whatever happens in regard to money in the future, citizens are to-day paying in many areas what they never ought to have been paying, as interest on money borrowed years ago. Therefore, the Government's suggestion should remain intact, and there should be security for the local authorities in this matter. We hope that the Government will stand firm with regard to their proposal.

Mr. Peake: May I, in three or four sentences, answer the questions which have been asked by my hon. and gallant Friend the Member for Penrith (Lieut.-Colonel Dower) and my hon. and gallant Friend the Member for Chichester (Lieut.-Commander Joynson-Hicks)? With regard to the former's questions, Penrith and Cockermouth will be able under this Bill to borrow virtually at the same rate as His Majesty's Government. The schedule of rates which I announced in the Second Reading Debate, as I then said and as I now repeat, is not fixed for the currency of the scheme. These rates may have to be adjusted either upwards or downwards during the period of years for which the scheme operates. The question of my hon. and gallant Friend the Member for Chichester with regard to "over the counter" borrowing is the same point we have met with in regard to municipal banks, on which I gave some assurances on the Second Reading Debate. Those assurances will be carried out. The question of precisely how it is to be done is now being examined. The scheme we arrive at will be embodied in the Regulations, and the Regulations, in case of


appeal, must be laid before Parliament, so that matter will be settled to the satisfaction of the House.
Amendment negatived.

Mr. Peake: I beg to move, in page 1, line 11, leave out "subsection," and insert "section."

This is purely a drafting Amendment.

Amendment agreed to.

Motion made, and Question proposed, "That the Clause, as amended, stand part of the Bill."

Sir H. Williams: There is power to make regulations under this Clause, and I would like to know when we are likely to see those regulations. Are we likely to see them before the Bill receives the Royal Assent, assuming that it gets through all the rest of the procedure? It is always advisable in order to avoid controversy about the matter that regulations should be published as soon as possible.

Mr. Peake: Perhaps my hon. Friend might raise the question on Clause 7 when we come to the regulations.

Question put, and agreed to.

Clause, as amended, ordered to stand part of the Bill.

Clauses 2 and 3 ordered to stand part of the Bill.

CLAUSE 4.—(Amendment of S. 5 of 4 & 5 Geo. 6, c. 14, and 2 & 3 Geo. 6, c. 62.)

Mr. Peake: I beg to move, in page 3, line I, leave out "In."
This Amendment, and the following Amendment on the Order Paper, to insert certain words, should be taken together. Their object is to carry out the undertaking I gave in reply to my hon. Friend the Member for Scarborough (Mr. Spearman) in the Second Reading Debate. Their effect is this. Clause 4 removes any time limit to the power given to the Treasury by the Public Works Loan Act, 1941, to underwrite conversion offers by local authorities who have the option of redeeming existing stocks. Paragraph (a) of the second Amendment extends the procedure for conversion in regard to funds to cases where the loan finally matures; and paragraph (b) provides that the definition of the expression "local authority" is slightly extended because

the position of a certain number of public water boards under the definition in the Act of 1941 is a little uncertain.

Amendment agreed to.

Further Amendment made: In page 3, line 3, after "securities" insert:
shall have effect subject to the following Amendments:

(a) the power of the Treasury to advance moneys to a local or harbour authority under Sub-section (1) shall be extended so as to include power, where the authority with the approval of the Treasury makes a new issue of securities for the purpose of meeting the liability on any of its maturing securities to advance to the authority, on such terms as the Treasury think fit, an amount equal to the price of issue of any part of the new issue of securities which is not taken up;
(b) the definition of the expression 'local authority' in paragraph (b) of Sub-section (4) shall be extended so as to include any local authority within the meaning of this Act; and
(c)."—[Mr. Peake.]

Mr. Peake: I beg to move, in page 3, line 4, leave out "such advances," and insert "advances under the section."

This is purely a drafting Amendment.

Amendment agreed to.

Clause, as amended, ordered to stand part of the Bill.

CLAUSE 5.—(Power to carry loans to consolidated loans funds and loans pools.)

Mr. Peake: I beg to move, in page 3, line 9, after "borrowed" insert:
(whether before or after the commencement of this Act).
This Amendment is for the convenience of certain local authorities who have already borrowed from the Public Works Loan Board, and it will enable them to deal with those loans through their Consolidated Loans Funds.

Amendment agreed to.

Clause, as amended, ordered to stand part of the Bill.

CLAUSE 6.—(Use by local authority of moneys forming part of capital funds.)

Mr. Peake: I beg to move, in page 4, line 22, leave out from beginning, to "but," in line 23, and insert "conferred by or under any enactment."
This has a slightly wider definition and it is an almost purely drafting Amendment.

Sir H. Williams: I think it needs a little more explanation than that, because of the words to be left out. Do they mean the same thing as "by or under any enactment"?

Mr. Peake: Under Sub-section (1) of this Clause a local authority can use the available balances on capital funds for any purpose for which the authority has a statutory power to borrow, and Sub-section (2) (d), as it stands without the Amendment, defines "statutory power to borrow" as
a power to borrow by virtue of any enactment or by virtue of any order or sanction of a government department.
We propose to leave out those words and insert instead, "conferred by or under any enactments." The reason for that is that, as the Clause is now drawn, it does not cover certain authorities whose sanction to borrowings is sometimes necessary—for example, the Metropolitan Boroughs have to obtain the sanction of the London County Council before borrowing can be effected. It is also doubtful whether the words "government department" in the Clause as drawn include the Electricity Commissioners.

Amendment agreed to.

Clause, as amended, ordered to stand part of the Bill.

CLAUSE 7.—(Laying of regulations before Parliament.)

Motion made, and Question proposed, "That the Clause stand part of the Bill."

Mr. Peake: I am informed that as regards the regulations to be made under Clause 1, we shall shortly be sending them to the local authorities for their comments. Of course, they will have to be looked through carefully in the light of what hon. Members have said in the course of the Debate to-day on Clause 1, but they will go straight away to the local authorities. We cannot promise that they will be ready for laying before the Bill becomes an Act.

Sir H. Williams: But cannot they be laid here provisionally, as soon as they are sent to the local authorities, so that hon. Members may have the opportunity of making comments? I would also like to know what is the position with regard to the regulations to be made by the Commissioners under Clause 2.

Mr. Peake: The regulations under Clause 2 have to be treated in exactly the same way as regulations under Clause 1. They have to be laid before Parliament in accordance with the provisions of this Clause. I will certainly consider my hon. Friend's point and see if it is possible to make advance copies of these regulations available in any way before the Bill becomes law.

Question put, and agreed to.

Clause ordered to stand part of the Bill.

CLAUSE 8.—(Interpretation.)

Motion made, and Question proposed, "That the Clause stand part of the Bill."

Captain Duncan: I see that the definition of a local authority is
any local authority being, within the meaning of the Local Loans Act, 1875, an authority having power to levy a rate.
The London County Council was not formed in 1875 and does not levy a rate. It issues precepts on the borough councils who levy the rates in respect of their own expenditure and that of the London County Council. Is the London County Council, therefore, exempt from this Bill or not?

Mr. Peake: I think my hon. and gallant Friend is wrong in this, Certainly the London County Council is intended to be subject to the provisions of the Bill. I will, however, look into his point between now and the Report stage.

Question put, and agreed to.

Clause ordered to stand part of the Bill.

Clauses 9 and 10 ordered to stand part of the Bill.

NEW CLAUSE.—(Amendment of enactments relating to minimum rate of interest.)

Each of the following enactments (which relate to loans made by the Public Works Loan Commissioners to local authorities) that is to say—

(a) the proviso to Sub-section (2) of Section fifty-two of the Small Holdings and Allotments Act, 1908;
(b) Sub-section (2) of Section seventy-two of the Housing (Scotland) Act, 1925; and
(c) Sub-section (2) of Section one hundred and twenty-three of the Housing Act, 1936; shall have effect subject to the following amendments, that is to say—

(i) in paragraph (a) (which provides that the loan shall be made at the minimum rate


allowed for loans out of the local loans fund) the reference to the minimum rate shall be construed as a reference to the minimum rate applicable to the period for which the loan is made;
(ii) paragraph (c) (which provides that the longer duration of a loan shall not be taken as a reason for fixing a higher rate of interest) shall cease to have effect.—[Mr. Peake.]

Brought up, and read the First time.

4.45 p.m.

Mr. Peake: I beg to move, "That the Clause be read a Second time."
The Committee is aware that we are proposing a Schedule of interest rates under the Bill which varies in relation to the term for which the loan is to be granted. There are these provisions in the Housing Acts and the Small Holdings and Allotments Act which, therefore, become inappropriate. It is perfectly clear that the housing loans must be granted upon the same terms as other loans for the identical period. It would not be fair to give local authorities borrowing for housing for 30 or 60 years money at a rate which is charged for loans for five years and, therefore, in order to make the necessary Amendment this new Clause is required.

Question put, and agreed to.

Clause read a Second time, and added to the Bill.

Bill reported, with Amendments; as amended, to be considered To-morrow, and to be printed [Bill 24].

Orders of the Day — POLICE (HIS MAJESTY'S INSPECTORS OF CONSTABULARY) BILL

Order for Second Reading read.

4.48 p.m.

The Secretary of State for the Home Department (Mr. Herbert Morrison): I beg to move, "That the Bill be now read a Second time."
This is a modest and small Measure which I hope will commend itself to the House. The appointment of inspectors of constabulary in England and Wales was authorised by Section 15 of the County and Borough Police Act, 1856, which was the Act of Parliament which, for the first time, made it obligatory for each county to establish a permanent salaried police force. The provisions of Section 15 of

the Act limited the number of inspectors to three, and required each of them to make an annual report to the Secretary of State which would be presented to Parliament. The provisions which related to Scotland were very similar except that Section 65 of the Police (Scotland) Act, 1857, permits the appointment of one inspector only in Scotland. The definition of the inspector's duties in Scotland is almost the same as that of the duties of inspectors in England, and the duties for England are defined in the Act of 1856, to which I have made reference as follows: they were:
… to visit and inquire into the state and the efficiency of the police appointed for every county and borough, and whether the provisions of the Acts under which such police are appointed are duly observed and carried into effect and also into the state of the police stations, charge-rooms, cells or lockups, or other premises occupied for the use of such police.
There is provision for reporting annually to the Secretary of State, who shall cause such reports to be laid before Parliament. When the 1856 English Act was introduced there was a Debate in Parliament, and in that Debate there was a good deal of suspicion because it was thought that the Government, by introducing a Measure making it compulsory for all areas to have a permanent police force, were moving directly towards despotism and the suppression of individual liberty. In the course of the Debate one hon. Member, according to the records, said that he thought the Measure would make the Secretary of State for the Home Department a second Fouché with spies all over the kingdom, and another Member, on the particular proposal to appoint inspectors, said that, having had much practical experience in the transaction of county business, he could state that he had frequently been obliged to fight against suggestions of inspectors, who had little or no practical knowledge of their business, but merely wished to exercise their authority. There was no Debate on the Clause, but in the Second Reading Debate several Members referred to the "degradation of inspectorship," and expressed the fear that inspection would mean interference and, indeed, direct control, by the central Government.
As the years have passed since that Act of the middle of last century, the police service has abundantly—as I think


the House will agree—demonstrated that the fears expressed at that time were unfounded, and that so far from the police becoming an instrument of oppression and despotism they have, in fact, shown themselves to be a bulwark of democracy and of liberty. The police have established a great tradition, based on the respect and trust of the community. This was, indeed, the spirit of our police from the outset. I found last week, on the occasion of my visit to the Lancashire County Constabulary, an old poster, or circular of instructions, which had been distributed among the police of Lancashire, and which contained a number of maxims. It was issued by the first Chief Constable of the County of Lancashire, and although perhaps we would not write some of it now, broadly speaking, it shows how excellent were the principles on which the police were established even at the beginning of that county force, and I think the House may be interested to know what the poster said:
(1) Constables are placed in authority to protect, not to oppress, the public.
[HON. MEMBERS: "Hear, hear."] That is admirable, and I am glad that it has the support of my hon. Friend the Member for South Croydon (Sir H. Williams).

"(2) To do which effectually they must earnestly and systematically exert themselves to prevent crime.
(3) When a crime has been committed no time should be lost, nor exertions spared, to discover and bring to justice the offenders.
(4) Obtain a knowledge of reputed thieves and idle and disorderly persons.
(5) Watch narrowly all persons having no visible means of subsistence.
(6) Prevent vagrants.
(7) Be impartial in the discharge of duties.
(8) Discard from the mind all political and sectarian prejudices.
(9) Be cool and intrepid in the discharge of duties in emergencies and unavoidable conicts.
(10) Avoid altercations and display perfect command of temper under insult and gross provocation, to which all constables must occasionally he liable"—

Sir Herbert Williams: That is like a description of a Minister.

Mr. Morrison: It goes on:

—"(11) Never strike but in self-defence, nor treat a person with more rigour than may be absolutely necessary to prevent escape.
(12) Practice the most complete sobriety. One instance of drunkenness will render a constable liable to dismissal.

(13) Treat with the utmost civility all classes of Her Majesty's subjects, and cheerfully render assistance to all in need of it.
(14) Exhibit deference and respect to the magistracy.
(15) Cheerfully and promptly obey all superior officers
(16) Render an honest, faithful and speedy account of all moneys and property, whether intrusted with them for others or taken possession of in the execution of duty.
(17) With reference to the foregoing, bear especially in mind that 'honesty is the best policy.'
(18) Be perfectly neat and clean in person and attire.
(19) Never sit down in a public-house or beer shop.
(20) Avoid tippling.
(21) It is the interest of every man to devote some portion of his spare time to the practice of reading and writing, and the general improvement of his mind."

Lastly—and this is very good—

"(22) Ignorance is an insuperable bar to promotion."

I thought that was a good try in those early days, and a lot of it still stands up. Similarly, His Majesty's inspectors of constabulary have completely falsified the apprehensions expressed about their possible activities, and this is a convenient opportunity of paying tribute to the invaluable work they have done in the past, and the great contribution they have made to the smooth running of the police system particularly during war-time. It has been the general practice to recruit the inspectors from the ranks of senior chief constables, and they have consistently succeeded both in maintaining the confidence and respect of the police service itself and also in giving technical advice of the highest order to the Secretary of State and his officers.
The House will note that this Bill does not suggest any change in the definition of the duties of the inspectors. In practice, although there is no statutory provision on the point, the inspectors in England are assigned separate districts and are principally responsible for inspecting the forces in those districts. They have, however, a considerable number of duties in addition. They are always available to advise and assist chief constables who wish to take advantage of their great experience and they are all constantly being asked to advise the Home Office, both on particular points of police administration affecting individual forces and on general questions affecting the


police service as a whole. They also conduct special investigations at the request of the Home Secretary when particular difficulties arise, and sit on tribunals set up under the Police (Appeals) Acts, to hear disciplinary appeals.
It is rather remarkable that the number of inspectors authorised by Acts passed as long ago as 1856 and 1857, when the police service of the country was scarcely out of its infancy, should have lasted so long without need for modification. But it is felt that, having regard to the duties of the police service, and particularly the prospects of post-war and technical developments, and the increasing complexity of police work, we ought to remove this limitation. There is, however, no question of any large-scale increase in the inspectorate. In time of war it has been found that the numbers of inspectors permitted by these old Acts was not enough to perform the multifarious duties put on to the inspectorate and Regulation 40 of the Defence (General) Regulations allows the Secretary of State to appoint additional inspectors of constabulary, notwithstanding the limitations in the Acts of 1856 and 1857.
At present, there is a total of four inspectors on active duty in England and Wales, and two in Scotland. In addition acting inspectors are attached to five of the Regional Commissioners in England and Wales for purely war-time duties. However, these last appointments attached to the five Regional Commissioners will shortly disappear. But in any event appointments made under Regulation 40 cannot be permanent, established appointments. It is not possible at this stage to forecast in detail how post-war developments are going to affect the inspectorate but it is clear, for the reasons I have given, that it will be of increasing importance and it will need to be strengthened if the police service in Great Britain is to be maintained at the standard of quality that all of us would wish, and if the necessary expert advice is to be available. Therefore we seek this additional power. Possibly one of these inspectors should be a person who has specialised knowledge of, say, the scientific side of criminal investigation, which becomes a matter of increasing importance, as I have appreciated, having seen the work of some of the Home Office

crime laboratories in various parts of the country.
The proposal made in the Bill does not involve any radical change in the existing traditional organisation whereby the separate police forces exist as separate units with their own authorities, and appointments will probably be made of four or five inspectors, I should think, at any rate for the time, each responsible for a separate district. In addition, it is contemplated that it may be found advantageous to appoint a Chief Inspector for England and Wales, and the Bill includes a provision which will permit the appointment of a Chief Inspector for England and Wales. If a Chief Inspector is appointed, he will in large measure be relieved of territorial responsibilities and in the main be responsible for directing the work of the inspectorate and will be generally available to advise the Secretary of State on technical matters and to help with the increasing volume of work arising out of special inquiries and the hearing of disciplinary appeals.
As regards Scotland, the present view of my right hon. Friend the Secretary of State for Scotland is that one inspector of constabulary should be sufficient, but it will depend on the way post-war circumstances develop and, in case it should be found desirable when the time comes in the interests of Scottish police efficiency to appoint a second inspector, the opportunity of this Bill is being taken to give the necessary authority. If the Secretary of State for Scotland should appoint a second inspector, he might wish that one should be made Chief Inspector for Scotland.
Another point is that under the existing law each inspector has to make a report to the Secretary of State, who in turn is required to submit it to Parliament. If we have this somewhat larger number of inspectors, with a Chief Inspector, it is proposed that the inspectors' reports should be collated and the Chief Inspector should make an annual report to the Secretary of State and that that should be presented to Parliament instead of the separate reports being presented, as hitherto. The Bill provides accordingly, following the precedent of the Factories Act, 1937, and it is also provided that there need only be one report for Scotland. It is contemplated that, if a Chief Inspector is appointed, he should be directed to


submit a report on behalf of the whole inspectorate, and there will be similar arrangements for Scotland. There is one small alteration as regards reports to which attention should be drawn. The Act of 1856 does not require annual reports, although it became the practice to submit annual reports. It is proposed in the new Bill to make the annual report a specific statutory requirement.
I think that describes briefly the purpose of the Bill. I know now a great deal of the work of His Majesty's inspectors of constabulary. It is very valuable work. I realise that His Majesty's Inspectors' reports are of great value to the Secretary of State in giving him a picture of things, and often advice about personalities and so on. The whole system works very smoothly, but it is thought that, whereas the system may have been good enough in the 50's, we ought now to follow the more usual custom of Parliament permitting the Minister concerned, with the approval of the Treasury, to appoint such number as he thinks fit. On the other hand, I can assure the House that there is no intention of making an increase in the number of a dramatic order.

5.6 p.m.

Mr. Rhys Davies: I also should like to add my tribute to the police; I have special reasons for doing so. Not many years ago, burglars stole my typewriter; they filed off the number of it but the police found it nevertheless. As the typewriter is a most useful instrument to me I consequently hold the police in very high esteem. In the financial memorandum of this Bill my right hon. Friend states that when it becomes an Act it will permit the appointment of a Chief Inspector for England and Wales and also a Chief Inspector for Scotland. I can understand the appointment for Scotland, but he lumped England and Wales together for this purpose. Why did he do that? If it is an international Measure, as suggested, he should not separate Scotland but lump the three countries together. I can assure the House that the feeling in the Principality of Wales is fairly strong and growing on these issues. I have some little knowledge of the police—I was once at the Home Office—and I understand that there are very excellent officers in the force bred and born in Wales. I should imagine, therefore, that my right hon. Friend

would have no difficulty at all in finding very efficient men to do the very highest technical tasks foreshadowed from among those Welshmen now employed in the police force. I leave it at that, and ask the right hon. Gentleman whether it is not possible to grant to Wales exactly the same privileges and facilities as are provided for Scotland in the Bill.

5.9 p.m.

Mr. Alexander Walkden: Those with whom I am associated welcome the Bill. We feel that it will be a useful Measure. I think it is wonderful that the police force has been run for 90 years under such a small number of inspectors. The way the force has developed out of its own virtues is very interesting indeed. It has become very popular with the public in general, including working people.
There was a time when they were not so popular. That was when they were used in connection with labour disputes. Fortunately, we have got far from those days. Now they are the helpers of the general public. Everyone likes them, and they are good fellows. It is felt that they need helping a little more by an additional inspector or two, we are agreed. Nothing helps so much as good supervision, if it is done in the right spirit. An inspector is a kind of big super-brother who can always help in time of trouble. I am a little intrigued by the request of my hon. Friend the Member for Westhoughton (Mr. Rhys Davies) in regard to the police in Wales, for I was always under the impression that the Welsh were without sin and had no need for a police force.

Mr. Rhys Davies: I did not ask for more policemen for Wales; what I want is the better jobs now proposed for the policemen who are already there.

Mr. Walkden: I understood my hon. Friend to ask for another inspector. An inspector, of course, would strengthen the spirit and morale of the force, and that indicated that my hon. Friend felt there was some need for the Welsh people to be looked after. I was not aware that that was necessary, because I was once assured by an eminent Welshman who used to be Prime Minister that the Welsh were so good that they had no swear words in their language and therefore


could not even swear. They are so saintly that I was amazed that my hon. Friend should ask for another inspector. The Home Secretary, with his usual fairness, will see what he can do about that, and we can leave it to him.
We all recognise the virtues of the police. May I say a word about the virtues of the public? The police force functions best where it has a friendly public. In countries where the public are cowardly when a gangster appears the people hold up their hands and it is hard for the police to do their work. I have been thrilled and inspired by reports of young girls in post offices refusing to do that when a burglar comes in and demands money. Young men in banks and railway booking clerks, when burglars enter and try to commandeer the cash, will not give way to them. They take measures to have the burglar arrested, and he is either caught or he makes great haste to get away. I have noticed in this great city, where I have been living for 38 years, the wonderful morale of the people. They are fond of their police and help them, and both police and people are on very good terms. I have seen times of political stress and strain and conflicts between the two Houses of Parliament in bygone days, when there might have been great demonstrations and difficulty with the public, but the conflicts have passed off quite calmly with good feeling and good sense.
I have seen war break out and peace break out, and great rejoicings among crowds when there might easily have been difficulties. In the last Royal Jubilee the public were so full of joy that we had the British Constitution, the best in the world, that they rejoiced and poured out into the streets in such enormous numbers that the police could not control them. The police let them go, and they behaved themselves so well that there was not one regrettable incident. That is wonderful, and I hope we shall continue in that way in this dear old country of ours, with a full respect for law and order and an efficient body of police to help. The police have had additional burdens put on them in these modern times, particularly by the development of road traffic, and the House will always be willing to give them any additional help that they need to carry out their duties.

5.16 p.m.

Lieut.-Colonel Sir Cuthbert Headlam: I listened with great interest to the hon. Member for Westhoughton (Mr. Rhys Davies), who thought it was necessary to introduce his Welsh bias in his desire to get something for Wales. I do not propose to ask for anything for Northumberland or Durham and I really do not understand why he should have introduced it.

Mr. Rhys Davies: But Northumberland is a county and Wales is a country.

Sir C. Headlam: Nor will I say anything in confirmation or the reverse of what the hon. Member for South Bristol (Mr. A. Walkden) said. I admire the orderly deportment and the peaceful ways of the British citizens as much as he does, and we all agree that we are a very admirable people. Nevertheless, we require police, and I realise that what this Bill is asking for is necessary. I only want to be certain that there is nothing behind it. I do not wish that there shall be in any way a national police force, and I hope that there is no intention on the part of the Government to try to consolidate the police in any way that will jeopardise the present system by which each county has its own police. I do not think that is the intention of the Government, but I should like it to be clearly stated that there is no such intention behind this Bill.

5.17 p.m.

The Joint Under-Secretary of State for Scotland (Mr. Allan Chapman): My hon. Friend the Member for South Bristol (Mr. A. Walkden), in a characteristically generous and informed speech, welcomed the Bill and made, as usual, one or two shrewd points. He paid a tribute to the police and the public in which the whole House will join and drew attention to the kind of problem that is likely to arise and increase in the future. Closer supervision of problems and greater knowledge in the police is, therefore, necessary. My hon. Friend instanced road traffic, and my right hon. Friend instanced the scientific side of police work. I thought that to a certain extent my hon. Friend also answered the speech of my hon. Friend the Member for Westhoughton (Mr. Rhys Davies). Having the honour to speak at times on behalf of one small country, I have sympathy with


another small country and believe that the Celtic fringe ought to be continuous and hang together.

Sir Herbert Williams: Or hang separately.

Mr. Chapman: That is so obvious an interjection that I did not think my hon. Friend would make it. My hon. Friend the Member for Westhoughton will appreciate that the whole Bill must stand on the question of organisation and numbers. In some parts there are very small police forces and in other parts big forces, and if the inspectorate is to be used to the best advantage it must be used in relation to the numbers and size of the forces. My right hon. Friend has authorised me to say that that will have to be the guiding principle but that he is not without some sympathy with the feeling which my hon. Friend has expressed. While I am not committing him in any way he will bear this matter in mind. As to my hon. Friend's second point, the question of the number of the population comes into the picture. I hope I have reassured my hon. Friend that the question of Wales is not being overlooked. My hon. and gallant Friend the Member for North Newcastle (Sir C. Headlam) has anxieties about there being some sinister intention behind the Bill. There is none at all. If he will look at a speech made by my right hon. Friend not long ago, he will see that he has no cause for the anxieties he expresses.
This Bill has received a kindly welcome from the House. I cannot help thinking of an incident during the last great blitz on the City, when I happened to be in conversation with a policeman. He was not young, and I should say that, had the war not broken out, he would have been near his pensionable age. I said to him, "I am afraid you are having a rather rough time." His reply was characteristic: "Not so rough as my boy is having in the Royal Navy." Then he added, "We have all got to do our bit." That "bit" by the police, whether established or war-time, whether men or women, or in town or country, has been magnificent throughout these islands. I cannot help thinking that that efficiency, that élan and organisation, has been helped by the wise supervision and advice of the inspectors of constabulary. If, in the future, with the complications of modern life—machines, science, and so on—we are to maintain that efficiency we shall have to

increase the inspectorate on the lines indicated by my right hon. Friend. Therefore, I commend the Bill to the House.

Question put, and agreed to.

Bill accordingly read a Second time.

Bill committed to a Committee of the Whole House.—[Major A. S. L. Young.]

Committee upon Tuesday next.

Orders of the Day — POLICE (HIS MAJESTY'S INSPECTORS OF CONSTABULARY) [MONEY]

Considered in Committee, under Standing Order No. 69.

[Major MILNER in the Chair]

Resolved:
That for the purposes of an Act of the present Session to remove the restriction upon the number of His Majesty's Inspectors of Constabulary that may be appointed under Section fifteen of the County and Borough Police Act, 1856, or Section sixty-five of the Police (Scotland) Act, 1857; to provide for the appointment of Chief Inspectors for England and Wales and for Scotland, respectively, and to amend the law as to the reports upon matters affecting the police which are to be laid annually before Parliament, it is expedient to authorise the payment out of moneys provided by Parliament of any additional expenditure incurred by reason of the provisions of the said Act of the present Session removing the said restrictions and providing for the appointment of such Chief Inspectors."—(King's Recommendation signified.)—[Mr. H. Morrison.]

Resolution to be reported upon Tuesday next.

Orders of the Day — ROAD TRANSPORT LIGHTING (CYCLES) BILL [Lords]

Considered in Committee.

[Major MILNER in the Chair]

CLAUSE 1.—(Cesser of exemption, in case of pedal cycles, from obligation to carry rear lamps.)

Motion made, and Question proposed, "That the Clause stand part of the Bill."

5.23 p.m.

Sir Herbert Williams: I beg to move, "That the Chairman do report Progress, and ask leave to sit again."
With your permission, Major Milner, I move to report Progress for reasons which I shall develop, and which I think you will regard as adequate. When we were discussing the Second Reading of this Bill last Friday, the question was raised


whether, if the Bill became law, the Common Law rights of the cyclists would be prejudiced. I think I raised the point. The Parliamentary Secretary to the Ministry of War Transport said:
I have taken legal advice, and I am assured that the Bill, neither directly nor by implication, in any way absolves the motorist from his duty to drive with due care and within the field of his vision.
He went on to imply that there would be no prejudice of the kind I had in mind. A little later, the Attorney-General intervened and said:
Of course, that is a fact in the case, but the fact of the bicycle rear lamp being out, although that is a breach of the law, does not relieve the motorist of his obligation to take due care in driving. They may both be negligent, and, of course, no one will suggest that the position of the cyclist should not be affected, when, knowing his light is out, for example, he goes on, recklessly and not caring."—[OFFICIAL REPORT, 2nd February, 1945; Vol. 407, cols. 1802 and 1812.]
The impression on my mind, and I think on that of other hon. Members, was that the position would not be altered. Then the hon. and gallant Member for Brighton (Lieut.-Colonel Marlowe) also took part in the Debate and he drew attention to his court experience. He went on to say:
I have had considerable experience in these matters, and I want to assure the House that liability must remain the same, that is an obligation on the motorist to see what is in front of him. It does not matter whether the cycle has a rear lamp, reflector or white patch, that liability remains the same. No cyclist, knocked down by a car because he has no rear light, will fail in any action if the circumstances are such that the motorist ought to have seen him. The legal liability remains untouched by this Bill.
That was a very definite statement. Then we got another lawyer, the hon. Member for Oxford (Mr. Hogg). He said:
I quite agree that it would be a matter to raise on a Bill of this kind, if it were considered that the cyclists' claim to compensation was affected by the proposed new regulation. I am quite satisfied, with my hon. and gallant Friend and with the Attorney-General, that the cyclists' claim to compensation is completely unaffected."—[OFFICIAL REPORT, 2nd February, 1945; Vol. 407, cols. 1827 and 1835.]
Towards the end of the proceedings my hon. and gallant Friend the Senior Burgess for Oxford University (Petty-Officer Herbert) drew attention to a Bill which was then pending in another place and I do not think the significance of his remarks was appreciated by the bulk of

hon. Members. The Bill to which I am now referring has a very important bearing on the Bill which we are discussing. It is entitled: "Law Reform (Contributory Negligence) Bill." It was introduced into the House of Lords by the Lord Chancellor on 17th January, and was read the First time in this House yesterday. Clause 1 (1) of that Bill proposes to alter the law, and reads as follows:
When any person suffers damage as the result partly of his own fault and partly of the fault of any other person or persons"—

Mr. A. Bevan: I am sorry to interrupt my hon. Friend, but may I ask at what point he is coming to the reasons for the Motion?

Sir H. Williams: I am stating the evidence. I will then draw the conclusions from the facts. I will only take a moment or two. The Sub-section goes on:
a claim in respect of that damage shall not be defeated by reason of the fault of the person suffering the damage.
I presume that means that if that Bill does not become law, a claim might be defeated in that way. Therefore the advice which the House received from the Minister, the Attorney-General and the two other learned Members, was inaccurate. I see that the word "fault" in the definition Clause is defined as follows:
'fault' means negligence, breach of statutory duty or other act.
Not to have a rear lamp, if the Bill which we are considering becomes law, will be a breach of a statutory duty. There is a Ministerial statement on this matter, because the Lord Chancellor said this:
The defendant's motor car may be proved to have helped to cause the accident by his negligence, or furious driving if you like.

The Chairman: I hope the hon. Member will not take that argument any farther. There is a standing Rule that hon. Members may not quote the speeches made by Members in another place, unless they are statements of Government policy. The quotation which the hon. Member is now making is not, I understand, a statement of Government policy.

Sir H. Williams: I may be under a misapprehension. I know there was a general rule against quotations from speeches made in another place; but I


understood that in recent years an exception had been introduced in respect of ministerial statements. The Lord Chancellor did definitely give that example and said that if a motor-car ran somebody down, if the person run down had committed any fault he can get no damages. We were told another thing last Friday, and the House was therefore deceived, I do not say maliciously, as to the significance of the Bill which is before us.
That seems to be a good reason why the House should give this matter more consideration before the Committee proceeds further with the Bill. There is one other ground. I want to urge that the Bill should not be proceeded with until the proceedings have been completed on the Law Reform (Contributory Negligence) Bill, so that we shall know what the state of the law is with regard to this matter before we change the status of the cyclists.
5.30 p.m.
The other reason I wish to put forward for moving to report Progress is that on Friday, when I protested that certain statistics were not available to hon. Members, the Parliamentary Secretary said that they were in the Library. After the proceedings I went to the Library, and I found there the statistics for October, 1944, and November, 1944, but not the other statistics. I accordingly wrote to the Parliamentary Secretary, who was courteous enough to send me these elaborate and lengthy documents, I got them only this morning. They have also been placed in the Library. I do not suppose that any hon. Member except the Parliamentary Secretary and myself has seen them. I have certainly not had the time to study them, but they indicate, as I thought they would, that the bulk of accidents happen in daylight, and that in summer-time there are more accidents in daylight than there are in winter time in daylight and darkness. These are very significant figures which Members ought to study. That is another reason for reporting Progress, in order that further proceedings on the Bill may take place when hon. Members have had more opportunity of studying the problem and of considering the relationship of this Bill to another to which I have made reference.

The Attorney-General (Sir Donald Somervell): The first point and one in

which, naturally, I am interested is whether I unconsciously misled the House. I am sure my hon. Friend is not suggesting I did so consciously. May I read again what I said, as it is short and accurate, and makes the position clear? I was asked to assume that there was independent testimony which proved that the light was out and asked what was then the position of the cyclist? My hon. Friend said it would be worse than it is to-day, without the slightest doubt, so far as compensation is concerned. I said:
Of course, that is a fact in the case …
The law is really quite sensible in this matter. The test which the court has to apply is, Has a man acted with reasonable care in all the circumstances? It is exactly the same as if a motorist found that his rear lamp had gone out. He has to act reasonably in the circumstances. If there is a garage handy he can take it there and get it mended. On the other hand, if he refrains from getting it mended when he could do so, and drives along, not minding, that may be held to be negligence. I went on to say:
… but the fact of the bicycle rear lamp being out, although that is a breach of the law, does not relieve the motorist of his obligation to take due care in driving.
That has been laid down over and over again. It was pointed out the other day that any motorist must expect that there will be on the road objects such as human beings or cattle which do not carry rear lights. There was one case in which a motor car ran into a pedestrian, and the court said in effect that that was negligence. The motorist must be going sufficiently slowly, or have lights sufficiently powerful, to enable him to avoid pedestrians, who have as much right on the roads as he has. Therefore, a motorist who ran into a bicycle without a rear light would almost certainly, as far as I can see, on the principles laid down, be guilty of negligence. Whether a cyclist has acted with due care in the circumstances is a fact that has to be considered, but it does not relieve the motorist of his obligation to take due care in driving.
Another point has been laid down in a case where a motor-car ran into a lorry, the rear light of which was out. The driver of the lorry did not know that the light was out—he had looked at it when he started and so on, there was no negligence. The mere fact that he was disobeying the law did not, it was held,


either amount to negligence or give the driver of the car a right of action against him. There, again, there is direct authority that where, without negligence, one is breaking the law, that fact by itself does not make one liable. I also said:
They may both be negligent, and, of course, no one will suggest that the position of the cyclist should not be affected, when, knowing his light is out, for example, he goes on, recklessly and not caring."—[OFFICIAL REPORT, 2nd February, 1945; Vol. 407, c. 1812.]
I was telling the House that this was a fact which would be regarded in considering a case where a man has taken due care. It would be quite impossible to forecast the circumstances. Anyone familiar with this branch of the law will agree that the courts do apply that test. They have sympathy with cyclists and pedestrians. It would be wrong to suggest there is any bias at all, but there is a feeling that the motor-car is to some extent a formidable thing and that it is its driver's business to see that it avoids others who are on the road.
My hon. Friend's main point was the existence of this other Bill. I would suggest to the Committee that that would not justify us in postponing consideration of this Bill, which lays down a perfectly clear principle which my hon. Friend is against and which other people are in favour of, namely, that a bicycle should carry a rear light. The only connection with the other Bill, and it is very remote, is that the other Bill applies over the whole field of negligence. At present, under our law, if a plaintiff is guilty of any negligence contributing to the accident, he can get nothing. The Bill to which my hon. Friend has referred modifies that. All that can be said is that there may be certain cases in which the fact of the light having gone out is a factor in a negligence claim, and if the other Bill, when it comes from the other place, is accepted by this House, the fact that the plaintiff has to some extent been negligent will not, as at present, shut him out altogether but will only reduce, according to the degree of his negligence, the amount of damages he recovers. With respect to my hon. Friend, it would surely be wrong to say that we are unable properly to consider a Bill providing for rear lights, because we may later be asked to consider a Bill which

alters the general law of negligence in favour of plaintiffs who have been negligent, and will apply to cases where this factor comes in, as well as to the vast range of other cases in which negligence issues arise.

Mr. Beverley Baxter: The Attorney-General cited the case of a motorist overtaking a lorry of which the rear light had gone out and of a collision taking place. He spoke about that accident as if the lorry driver was the person who might have been proceeded against, and that the motorist was entirely innocent because he was not supposed to look at lights that did not exist on the lorry. It seems to me, if I understood his explanation correctly, that a motorist overtaking a cyclist whose rear light has gone out is still responsible for not striking that cyclist, for looking for a light that does not exist and avoiding the cyclist. Does he distinguish between the legal liability of a motorist in respect of a lorry without any lights and that of a motorist overtaking a cyclist whose light has gone out?

The Attorney-General: The question is always the same, Did you take due care in the circumstances as they were? The circumstances may be very different. I cited that case because I thought it was of importance in the Debate, where it was laid down quite clearly that the fact that one was not complying with the law did not bring one under a civil liability to the other party.

Mr. Baxter: If the motorist had struck a lorry the light of which had gone out under any conditions, could that motorist have been proceeded against for negligence?

The Attorney-General: It entirely depends on the circumstances of the case.

Lieut.-Colonel Sir Cuthbert Headlam: I am rather inclined to support my hon. Friend the Member for South Croydon (Sir H. Williams), but not on quite the same ground. Judging from the letters I have received, this Bill is exciting great opposition throughout the country, rightly or wrongly. Many of us have not had the opportunity of consulting our constituents who are cyclists and who are anxious to consult us. I can see no reason why the Bill should be forced through to-day, when


the point which is being contested is already in operation. Red lights are already carried by cyclists; what is proposed now is to enforce that by law. I resent our being asked to pass this Bill through its remaining stages so quickly, when there is no urgent need whatever for it. Therefore, if my hon. Friend goes to a Division, I shall support him.

Petty-Officer Alan Herbert: I am a supporter of this Bill, unlike the hon. Member for South Croydon (Sir H. Williams), but I think the Attorney-General might give a little more attention to what he said about a point I raised on Second Reading. It was not so much a legal point as a matter of the Government's co-ordination of policy. I gather from the Attorney-General that if the people who object to this Bill were assured that the other Bill was going to become law they would be reassured. I hope that the Attorney-General will correct me if I am wrong; but if this second Bill becomes law, is it not a fact that the dependants of a cyclist who is found dead beside his bicycle, without any evidence of his light ever having been on, will be in a much better position? Is the second Bill going to help the cyclist or his dependants, or not? Suppose we pass this Bill, but, by some accident, the second Bill does not become law; will not the situation of the dependants of the dead cyclist who had no lamp be substantially worse? In other words, is not my original point correct, that the two Bills should, so far as they concern the bicyclist, have been brought before this House together? Should not the second Bill come first, or should not such parts of the second Bill as are relevant be taken out of it and put into this Bill? I am in favour of this Bill, but I think there is a great deal to be said for the contention of the hon. Member for South Croydon that we should put into this Bill, which is causing so much disquiet—I think, unreasonable disquiet—the relevant parts of the second Bill.

Mr. Evelyn Walkden: Can the Attorney-General deal with the statement made in another place by the Lord Chancellor on the Law Reform (Contributory Negligence) Bill, when he stated, very definitely, that if the defendant proves—

The Chairman: Arguments used in another place cannot be quoted here.

Petty-Officer Herbert: On a point of Order. Surely, when the Lord Chancellor is speaking, not merely as a Member of the Government, but as our greatest legal expert, we can quote his words? It is not a question of quoting polemical or political utterances.

Sir Patrick Hannon: If the hon. Member cannot quote the precise words, can he give the substance of them?

Mr. E. Walkden: If the defendant proves that the plaintiff contributed to his own injury can the plaintiff recover anything at all, under the existing law? If the cyclist suffers damage or injury, or is killed, and the motorist—or two motorists—say that he had no rear light, and there is nobody else to give evidence to the contrary, is the motorist right and the cyclist wrong, in law, with the result that the cyclist gets no damages whatever?

5.45 p.m.

Mr. Edmund Harvey: I hope that the Government will accept the Motion of my hon. Friend, because there is no doubt that among cyclists there is an impression that this Bill is being rushed through. It is most undesirable that the Government should appear to be rushing through legislation when there has not been full opportunity for the persons most affected to put their objections and to examine the explanations of the Government. If the Government can remove misconceptions the position will be much better. It has been pointed out that there is no reason for hurry, because the present Defence Regulation may continue for many months, and perhaps years. There is no reason why the Government should not use their existing powers until the matter has been carefully examined and a right solution agreed upon.
Following what has been said by my hon. Friend the Member for Doncaster (Mr. E. Walkden), I feel that the cyclists, under the existing law, have a real reason for anxiety, because, in the event of an accident in which a motor car has run into a cyclist from behind, there is, if the cyclist survives, only one man's word against another's. The motorist may really not have seen the red light, and he may think that there was not one. The cyclist has only to say, "There was a red light when I last looked round." He


may be asked in court, "Did you look round to see whether there was a rear light burning immediately before the accident?" In most cases he will not have done so immediately before the accident, and therefore he cannot be certain. On the other hand, the motorist will say, "I saw no red light," and the court will assume that the light was out. It may have been burning, but the cyclist cannot prove that it was. This places a great difficulty in the way of a great many good citizens, not only those who use their cycles for pleasure, but a vast number who use them for their daily work. Surely it would be better to wait for that other Measure, of which we have heard, but which has not yet received a Second Reading, rather than to alter the general law for cyclists before the position has been clarified.

Mr. Stephen: I wish to add my plea to that of other hon. Members for the acceptance of this Motion. I realise that there is very great anxiety in the minds of many people with regard to this Measure. They tell me there are 10,000,000 cyclists in Britain, and I think that the Committee would be very ill-advised in rushing into this thing without giving full consideration to the interests of all those people. I myself am a lawyer, and, naturally, I take a certain interest in the question from the point of view of people who have suffered accidents in the past. I have a good deal of experience in connection with this type of case, and I certainly wish to add my plea to the others that have been made that the Government should accept this Motion and delay this matter until the question of compensation in the other Measure is fully dealt with.
The Attorney-General and the Solicitor-General will agree that if this legislation is put upon the Statute Book, there will be very grave difficulties in regard to cases that may arise after accidents. It is so difficult, when a casualty on the road takes place, to get satisfactory evidence, and by this Measure as it stands, unless there is a qualification so far as contributory negligence is concerned, the rights of all cyclists will be very much damaged. I think it is a great pity that the interests of the motorist, as against those of the cyclist, are having such great consideration.
The Government has had a very good day with its business and I hope that it will meet the well-founded anxiety in connection with this Measure. The major consideration is the public safety. We are all appalled at the number of accidents on the roads, and any steps that will tend to reduce them will receive the consideration of hon. Members of all parties. We are all in agreement in that respect, but, while that is so, some of us are doubtful whether this Measure will really be very fruitful in producing any reduction in the number of casualties. As it stands, all these cyclists will certainly be put into a very much worse position in regard to their legal claims in connection with accidents. I hope the Government will meet us, and agree to the Motion before the Committee.

The Chairman: There is a tendency to argue the merits of the case. I must point out to hon. Members that the Motion before the Committee is that I do report Progress, and it is to that Motion that hon. Members must address themselves

Sir Patrick Hannon: You and I, Major Milner, have seen many projected Measures of legislation thrust hurriedly upon the House of Commons, and I suggest that this Measure also has been hurriedly thrust upon us. I would suggest to the Parliamentary Secretary that it would be advisable to postpone the first examination of this Measure until we get a large measure of public opinion on the subject. I agree with my hon. Friends opposite that rushed legislation in this House has always had bad consequences afterwards, and I think we ought not to inflict this great disability upon the cycling community. I support the Motion to report Progress, because I think the Measure ought to be further considered. The Parliamentary Secretary has given great thought and time to this Measure, and he has written me some very charming letters, though without giving way in the smallest degree. Consideration of the Measure ought to be suspended for a short time, because it has been thrust upon the House of Commons and there is a very strong feeling throughout the country that cyclists will be placed in a difficult situation. We should think of all our workpeople cycling to and from work in the morning and


evening under very great difficulties. I strongly support the Motion.

Mr. A. Bevan: I rise with some diffidence to intervene in this Debate, because I do not quite understand what the attitude of the Government may be. If we have a Division and the Government are defeated, the Prime Minister is not available to come down to the House and put us in Order again. Most of the speeches which have been made have been directed to the merits of the Bill, and our terms of reference from the House are to consider the details of the Bill, which has already been given a Second Reading. Most of the arguments that have been advanced on this Motion have, in fact, been directed against having a Second Reading at all. I do, therefore, respectfully submit to my hon. Friends who used those arguments that, if they believe they are sound, they ought to have voted against the Second Reading of the Bill and not used those arguments at this moment.

Dr. Russell Thomas: Always controversial.

Mr. Bevan: I do not know what the hon. Member means. What is this Chamber for? We are arguing with each other at the moment. There seems to be substance in one contention, and that is that the Government are in active consideration of a change in the general body of the law relating to this matter. If we pass this Bill, and then we have to consider the other Bill, in order to give effect to some of the views that have been expressed to-day, we shall have to make a particular Amendment, for the case of cyclists, to the general body of the legislation, and that is a very clumsy way of going about business. If the Government have under active consideration a change in the general body of the law which would affect the status of cyclists, and the use of rear lamps, that general change should be made before this particular legislation is passed.
Therefore, as there is no special urgency about the matter, the Government would be well advised to postpone the Committee stage until they had ascertained the views of the House concerning the general principles, and then should consider this particular legislation against whatever we might decide about the general legislation itself. That is a sound reason for asking

for the postponement. Cyclists are being unnecessarily murdered on the highways. I am, in general, a supporter of the idea that cyclists ought to be called upon to protect themselves as far as possible, but that is no argument for doing our work in a clumsy fashion, and I hope we shall postpone this Committee stage until we have the other Bill before us and can consider the realities of the situation.

6.0 p.m.

Vice-Admiral Taylor: I hope that the Government will not accept the Motion. I understood from what my hon. Friend said that the other Bill which has been mentioned will not directly affect cyclists. The question whether cyclists should carry a rear red light is not a new one. It is a question of very old standing and ought to have been settled long ago. Undoubtedly it must be to the advantage of motorists to see more light—

The Chairman: The hon. and gallant Member also appears to be arguing the merits of the Bill. The Question before the Committee is whether I shall report Progress.

Vice-Admiral Taylor: An hon. Member opposite has mentioned that this legislation is being rushed. A Second Reading has been given to this Bill and there has been ample time for everybody to state their opinion one way or the other. I see no adequate reason why the Motion should be accepted by the Government.

Major Procter: I would add my plea to the Government to postpone the further consideration of this Bill until we have had greater provision made for the legal protection of cyclists as against motorists in respect of accidents. There may be two or more passengers riding with a motorist ready to give evidence against the cyclist. It is a very difficult matter for the cyclist, seeing that he cannot see whether the rear light is burning or not, to rebut the evidence or testimony of the motorist and others in a car. There is another Bill which was introduced in another place which apportions the damages accruing from an accident to the degree of negligence of the parties concerned. In future the law governing negligence of motorist or cyclist will be in line with the law dealing with negligence in the cases of collision of ships at sea. If the proposed Bill were in force


now it would be possible for the quantum of damage to be approximated justly to the injuries of the cyclist provided that in this Bill there were words inserted to protect the cyclist against the difficulty of proving that in fact his light was burning at the moment of impact.
Therefore it seems to me that further consideration by the legal gentlemen and the Members of the Government is necessary to see in what way the difficulties of proof can be overcome. Everyone of us believes that there should be adequate protection by lighting to save life. We are all with the Parliamentary Secretary on this matter, but I think we are doing an injustice to the cyclist in this matter of evidence in cases where it is alleged that the cyclist had no rear light. Henceforth all a motorist will have to do in a running down case is to prove that there was no rear light.

The Chairman: The hon. and gallant Gentleman seems to be arguing the merits of the Bill. That really is not the question before the Committee.

Major Proctor: I am sorry. I ask that the Government postpone further discussion of this matter until the legal position of the cyclist vis-à-vis the motorist is adequately safeguarded, and the cyclist is protected legally as fully as the Parliamentary Secretary wishes to protect the life of the cyclist.

The Attorney-General: We have listened to the various arguments and I must be frank with the Committee and say that we are not convinced. I would like to emphasise, however, as did my hon. Friend the Member for Ebbw Vale (Mr. A. Bevan), that this Bill did get a Second Reading without a Division. I would also like to say on behalf of my right hon. Friend that we do not admit that the House has been rushed. The Bill was introduced first in another place. This is a very old question, and we do not admit, comparing it with our normal procedure, that the House has in any way been rushed. I will not go again into the question of the relationship with the other Bill. I have stated my argument and hon. Members have stated theirs. We hoped to make some progress this evening, but, owing to the lateness of the hour, we feel that we should not make substantial progress. Therefore, without, as I say,

being convinced—and the future course will be a matter for consideration—we are prepared to accept the Motion.

Sir H. Williams: May I thank the Attorney-General very much for his courtesy?

Question put, and agreed to.

Committee report Progress; to sit again To-morrow.

Orders of the Day — BUILDING INDUSTRY (RELEASES FROM FORCES)

Motion made, and Question proposed, "That this House do now adjourn."—[Mr. Buchan-Hepburn.]

6.9 p.m.

Mr. Martin: The question to which I now wish to direct the attention of the House is that of the release of members of the Services with particular technical qualifications for employment in the building industry. I want to raise it as a general question, but I wish to devote most of my remarks to illustrations which have occurred in my constituency which, I think, show the sort of thing that is happening at present. I have been in some difficulty in this matter because the truth is that no one Department is, to a satisfactory extent, responsible for this matter. The Ministry of Works and the Ministry of Health are both interested in the technical and building side of it, and the Ministry of Labour in the labour side. But the final court of appeal rests with the Service Departments and it is, therefore, rather difficult to pin the responsibility on to any particular person.
The three cases of which I want to give illustrations are as follow: In the summer of 1943 a certain area in my constituency had been badly blitzed. There was in that area a small working builder of the name of Murphy, trading as C. Taylor, who had long experience of the houses in his particular district. I would like to emphasise that these small working builders are like the family doctors in country villages. They know everything about the insides of the houses in their district, in the same way as the family doctor knows, or should know, everything about the insides of his patients. Their technical knowledge is of great value and importance at the present time in the


maintenance and repair of houses under existing conditions. Where a house has been comparatively slightly damaged the local builder, knowing all about its interior conditions, is much more competent to render first aid repairs than a highly skilled and highly articulated firm which may be called in to deal with a number of houses. Members pointed out that fact at the time to the Government, and it was as a result of those representations that small local builders were called much more into activity. Moreover, nearly all these builders are highly skilled, technical, craftsmen; they are not just mere business men; they do a great deal of work themselves.
Now I come to the particular point with which I wish to deal. This man, Mr. Murphy, was called up by the Navy and enlisted as a craftsman, but since then he has been employed as an ordinary seaman. Owing to the great disrepair in that district at the time of the blitz representations were made to me by the local sanitary inspectors, by the Metropolitan Water Board and by the local agents of two large estates in the district, and by a number of other people connected with the council, that this man should be released at once. I wrote to the Ministry of Health at the time when the Ministers of that Department were changing. I also wrote to the Admiralty in the hope that they might do something, with a little pressure, on their own. They sent a most sympathetic reply, stating that they would be glad to consider the matter if the Ministry of Health would make the necessary recommendation. The Ministry of Health replied that it could not do so because the Admiralty would certainly take no notice of them if they did. There the matter rested. I made some representations to the Minister of Health at that time, but he was newly come into office and there were difficulties in going very much further.
Then we pass to the summer of 1944. The flying bombs began, fresh serious damage was done in the neighbourhood, and the position again became urgent. Fresh representations were made to the Ministry of Works and Buildings for Mr. Murphy's release but again it was refused. In September the manager who had been put in to run the business when Mr. Murphy was called up was found to have peculated its money and to have neglected to carry out the repairs which

in fact the local authority believed he was carrying out during this time, or even to obtain the necessary materials, and a large number of bombed houses went unrepaired for a considerable time. Mrs. Murphy, who had a young child and a sick mother on her hands as well as the business, wrote in great distress and fresh efforts were made, which were equally unsuccessful. Shortly afterwards we had a Debate on bomb damage and there was a good deal of conversation between Members and Ministers, and a number of us received positive assurances that skilled men would be released where necessary. Mr. Murphy was a highly-skilled plumber, and I believe he was also a skilled slater, but these qualifications were not sufficient to obtain his release. I put down a Question to the Prime Minister who, as Minister of Defence, seemed to be mainly responsible for the collective action of the Service Departments, and the Question was transferred to the Ministry of Labour. The Parliamentary Secretary said that if I would inform him about the particular case he would do what he could. Once again I began on the sad story and appealed to the Ministry of Works that Mr. Murphy should be released for the benefit of his neighbours, but I was told that nothing could be done.

The Parliamentary Secretary to the Ministry of Works (Mr. Hicks): The Ministry of Works recommended that this man should be released but the Services were unable to release him. It was not the Ministry of Works who turned my hon. Friend down.

Mr. Martin: My hon. Friend is quite right. Mr. Murphy's father intervened and we jointly wrote to the Ministry of Works, who made an application for him, but it was turned down. I appealed as a last resource to Lord Woolton, who I knew took a great interest in the matter and who I felt would at least approach it with a good deal of resolution. He was kind enough to go into it with me and, as a result, things began to move. The Ministry of Works put in an application to the Admiralty. That application was in due course turned down on the ground that it was not justified. That is the story of one case.
I have another very similar case. The partner of a small business a mile or two away was a man of 73, who became ill


and was sent by his doctor into the country and became practically bedridden. He had a son serving in the Artillery, and, most of his men having been called up, this young man was given compassionate leave to see whether he could do anything for the business. In addition to being associated with his father as partner in the business, he was a qualified slater and tiler. He was exactly the kind of man who the Minister of Health in his speech in the House on 27th October said was most needed at that time for this purpose and who, he assured us, the Service Departments would release. Except in very exceptional circumstances such men would always be released. A number of us also received the solemn assurance that that would be so. This man, however, in spite of being a qualified slater and tiler, and also the only surviving mainstay of the business, was refused release. In consequence, the business ceased to function. One business was functioning under a dishonest manager who was peculating the profits and neglecting to do his job, and the other business ceased to function, in spite of the fact that it has large reserves of material which are not being used on the stricken houses in the neighbourhood. The third case I have is that of a foreman plasterer who was employed by a big firm and is now in a cavalry regiment at York. He was also applied for in the same way and turned down. I do not expect my hon. Friend to deal with these cases as it is not for his Department to do so. I am only quoting them as illustrations of what is going on. I am assured by other hon. Members that they have similar cases in their constituencies and that all over London repairs are going short for the want of certain skilled craftsmen.
I have certain questions I want to address to my hon. Friend. I do not know whether, as Parliamentary Secretary to the Ministry of Labour, he will be able to answer them, but I feel that the House will agree with me that they are reasonable questions to ask. The first is: Who are the officers in the Service Departments who deal with these applications? Who is for practical purposes the final court of appeal? Who is the final authority for deciding whether a man should go or not? Whoever it is presumably knows a great

deal about the need of the Service Departments, but has he any training or knowledge or experience which qualifies him to compare the respective needs of the civil population in this grave dire necessity with the needs of the Services? The second question is: What knowledge does he have of the particular case involved? Does he take the word of the man's commanding officer that the man is indispensable, or is there some general standard laid down which he has to observe, or how is it decided whether a man is indispensable?
Like other hon. Members, I was a soldier in the last war. I was for some months in a brigade office, and I have a little knowledge of how these things very often are worked. I shall not be satisfied with a mere assurance by my hon. Friend or by anybody else that the thing is most carefully and elaborately gone into. I have seen many cases in the past where an appeal has been made for the release of a man and the Commanding Officer says: "Oh, no, on no account. He is my batman," or "He is the sergeant-major's right-hand man," and the thing is ignored without any consideration of the merits of the case.

Commander Prior: Can the hon. Member say whether Mr. Murphy was qualified in any way? Was he a gunnery expert or had he any other kind of qualification?

Mr. Martin: He was enlisted in the Navy as a craftsman. I suppose he was in a parallel position to a master builder, but up to last Christmas he had not been employed in any technical way at all, and only as an ordinary seaman. To return to the point I was making: Does the officer who decides these matters have any knowledge of the particular cases involved? Thirdly, is there any case on record in which the officer concerned with these matters has consulted the Member of Parliament, the Minister, the representative of the local authority or anybody else responsible for asking for the release, or has gone into the case and tried to ascertain really whether there was a case which ought to be granted? Or, on the other hand, does the officer proceed simply on the naval, military or air force evidence that happens to be before him? Fourthly is a point which I have been asked to put by the hon. Member for


Twickenham (Mr. Keeling), who is unable to be present to-night although he would have liked to take part in the Debate. The question is whether there is any case on record of a Member of Parliament being told what the grounds were for the release being refused. So far as we can tell, there is no evidence of any of these things being done.
I do not want to keep my hon. Friend too long, but I want to say that I consider this is a very grave and serious matter. The people of London have suffered a great deal, mainly from enemy action during the last few years but greatly from the natural neglect of houses incident upon the war, the increasing disrepair of houses, and the damage done by the weather. They have suffered very severely indeed. I feel that the Government—when I say the Government I mean in particular the War Cabinet—have shown incompetence and neglect in this matter. I feel that they owed it to the people of London to treat the question as one of much greater gravity and with a much more efficient organisation than they have done. The final decision should not have been left entirely to the Service Departments, but there should have been a court of appeal where the merits of the Service case could have been contrasted with the other claims. I hope I shall receive the support of the House in asking that this matter be dealt with with more seriousness than it has been dealt with in the past. Unless the Government can show that they are making efforts to see that the people from London receive more relief and unless satisfaction is received from the Minister, we shall not allow the matter to rest in this House.

6.30 p.m.

The Joint Parliamentary Secretary to the Ministry of Labour (Mr. McCorquodale): I wish my hon. Friend had given me a little longer in which to reply. I have only seven minutes left and I would have liked a good quarter of an hour in which to rebut some of the charges which I think he most unjustly made against the Government. The Government have made the most prodigious efforts to deal with the situation in London. We have maintained a labour force of some 130,000 on this job of repairs of houses alone. We have 45,000 building trade workers being fed and billeted in London. The whole of the rest of the

country has been denuded of every mobile builder who could be moved. In many other parts of the country repairs and building have stopped because London is righty regarded as having preference at this time. London should recognise that the rest of the country is making a sacrifice on their behalf and that the Government are doing the best they can.
I would like to spend half a minute in thanking the many organisations, the National Hostels Corporation, voluntary bodies, the girls who came from Scotland, domestic science students, trade unions and other interested bodies, people who came together to feed and maintain this vast body of people who came into London to help London in her necessity. I do not believe these people have had their full meed of praise up to now and I would like to take this opportunity of giving it to them. Also, I think the people of London should be grateful to the Services for the great effort they have made to provide help in this problem. The Services provided immediately on demand and at great inconvenience to themselves a considerable number of men in uniform which had a great effect on the morale of the people as well as on getting repairs done. There has been something between 5,000 and 6,000 Service men in uniform maintained on this work during the last six months. In addition to that there are nearly 2,000 Americans in uniform, and we are very grateful to them—about 8,000 people of the American Forces and the Army, Navy and Air Force in uniform. In addition, the Army has made nearly 2,000 individual releases and there have been some from the other Services of skilled craftsmen where that could possibly be done in order to meet the difficult position in London. That is as I have said 7,000 to 8,000 people in uniform, and 2,000 released for a period of six months or more from the Forces to help in this situation—9,000 or 10,000 in all.
We must remember in this matter the position in which we are in the war. We are at the climax of the war, we are at an intensity of fighting and of military operations such as has not been reached before in the war, and nothing we do must, in any way, starve or hinder the operational needs of the Services. At this moment above all other matters that must be


the first care of the Government and I am not prepared to stand up here and say I will challenge in any way the decision of a Service Department as to whether on operational grounds they can or cannot release any member of that Service. What the hon. Gentleman said about Mr. Murphy and Mr. Palmer is quite true. One happened to be in the Army and the other in the Navy. I have not the full particulars of the other man. I think I suggested to the hon. Member in the end in correspondence the method by which he should proceed. These applications were made by the Ministry of Works, and were supported by the Ministry of Labour on industrial grounds. It is the duty of the Ministry of Labour to report to the Service itself whether on industrial grounds we consider that a demand should be made to the Service to take an abnormal step of releasing a skilled man—skilled in his trade of fighting—from the Forces.
In both these cases, we said that we would like to see the men released on industrial grounds. In each case, the Department looked into the matter carefully. It was not the decision of a single officer: the case was built up; the position of the units in which the men were serving, what duties they were going to, whether they could be replaced, and other matters were taken into consideration by the Departments; and in both cases the answer was that the men could not be released.
I am not going to challenge that decision, and I am not going to ask the Service Departments to justify their decision. The Service Departments have to justify themselves by winning the war, and they cannot be expected to argue each case to civilians, who may not be able

to appreciate the operational emphasis which has to be placed on a man's work. The Ministry of Labour, who are the focal point through which all these applications go, have found the Service Departments most co-operative, especially in releasing skilled building labour for this present crisis. But the Service Departments have an overwhelming responsibility for fighting the war, and we must not ask them to do anything which might hinder them in that responsibility. When all that is taken into account, for example, I find that the Army have gone to the limit over skilled specialists, such as slaters. That is a very bold thing for them to do, and they would not do it but for the fact that they realise the importance of these problems.
But I ask the hon. Member, would it be suitable for the local Member of Parliament to wait on the commanding officer of one of these men, who may shortly be going into action, to show what he can do in the civilian field? The right system is for the Minister of Works to sponsor the application, for the Minister of Labour to vet it from the point of view of civilian needs; and the decision must be made by the Service Department in the interests of the war effort, and of operational and other needs. That is the system upon which we operate. We are very sympathetic, the country is very sympathetic, and the Services are very sympathetic to London in the difficulties it has gone through; and I believe that when the story of the last eight months comes to be written, the people of this country will be astounded at what has been done.

Question put, and agreed to.

Adjourned accordingly at Twenty-two Minutes before Seven o' Clock.